Property Management Growth with DoorGrow

DGS 316: Happier Property Managers - Mindset, Mental Health and The Future of PM with Ashleigh Goodchild

Do you enjoy property management? It's often a thankless industry, and it's easy for property management business owners and their team members to become unhappy and burnt out. In this episode of the #DoorGrowShow, property management growth expert Jason Hull sits down with Ashleigh Goodchild, the voice behind PM Collective, to explore what it really takes to build a property management career that you can enjoy. You'll Learn [01:06] Importance of Having Support [08:01] Community-Led Learning for Property Managers [15:07] Structured Management vs. Random Leadership [21:36] People-Centric Property Management [32:41] Making the Invisible Visible Quotables "There's so much help available out there. And a lot of times we just don't ask as entrepreneurs." "The slowest path to growth is to do it alone." "A lot of people don't actually see what we do. And I think that's where you've got the opportunity." Resources DoorGrow and Scale Mastermind [https://www.doorgrowacademy.com/courses/mastermind] DoorGrow Academy [https://www.doorgrowacademy.com/] DoorGrow on YouTube [https://www.youtube.com/channel/UCC1mGYT2Sw0LOe32hO_QdNg/featured] DoorGrowClub [https://doorgrow.com/] DoorGrowLive [https://doorgrowlive.com/] Transcript Ashleigh Goodchild (00:00) Generally churn rate and loss rate for businesses can range anywhere between 15 and 30%. Our office is sitting at about 5%. we've got 1200 doors, to have that 5 % churn rate actually considered really great. Jason Hull - DoorGrow (00:05) Yeah. Welcome everybody. I am Jason Hull, the owner and founder of DoorGrow, the world's leading and most comprehensive coaching and consulting firm for long-term residential property management entrepreneurs. For over a decade and a half, we have brought innovative strategies and optimization to the property management industry. We've talked to thousands of property managers, helped them add hundreds of doors, help them increase profit, simplify operations, get themselves out of the business more and more. And we believe the good property managers can change the world and that property management is the ultimate high trust gateway to real estate deals, relationships and residual income. We are on a mission to transform property management business owners. and their businesses. want to transform the industry, eliminate the BS, build awareness, change perception, expand the market, and help the best property management entrepreneurs win. Now let's get into the show. So my guest today is Ashleigh Goodchild. Welcome. She's the voice behind PM Collective, the art of property management. together, we're going to explore what it really takes to build a property management career that you can enjoy covering the balance between structured management and random leadership, how to create workplaces people actually want to stay in, and Ashleigh's vision for a more human, less transactional industry. So Ashleigh, welcome to the show. Ashleigh Goodchild (01:35) Thank you so much for having me. Jason Hull - DoorGrow (01:37) So let's give us a little bit of background on you for those that don't know you yet, that maybe you're listening. How did you get into entrepreneurism? How did you get into doing what you're doing now? Give us some of the backstory. Ashleigh Goodchild (01:52) Yeah, so I started real estate back when I was 18 and like many people just falling into it and I was placed into an office that had a business owner, one was an air hostess and one was a pilot and really had no idea of how to run the business. So at that age of 18 and not knowing any better, I just jumped straight into the business and started helping them quite a lot. And then As I went on in my career, I then started my business, SoCo Realty, when I was 23. So I've had that business for 20 years and I've had a very blessed property management and business ownership life. I do say though that when I was 23 and when I started the business, I don't think it would have mattered what I was doing. It wasn't actually about the property management. It was actually probably about business ownership that I was drawn to. And I think I always say, even if I was a hairdresser at 23, it would have been a hairdresser shop that I opened up, just happened to be working in property management. So I've been running that and I've had a very blessed property management life. I always feel a little bit guilty when people talk about the roller coaster of their property management businesses, because I don't feel like I've had that. Or if I have, I sort of feel like maybe I just didn't sweat the small stuff. And so that led me into... Jason Hull - DoorGrow (02:50) Yeah. Yeah. Ashleigh Goodchild (03:10) running and founding PM Collective, which was bringing in a peer-to-peer mentorship and training Australia-wide where we run 200 coffee and conversations every year. And we really support each other in the industry just by that casual learning from each other. Jason Hull - DoorGrow (03:27) That's awesome. So they're getting together, hanging out with each other, sharing ideas, and you're kind of the facilitator in this. Ashleigh Goodchild (03:35) Yeah, we do it Australia wide. have loads of hosts around Australia. So other people like myself who want to give back. So it's a great opportunity for people to give back. We've actually run a couple over in the US as well. And we have just had one in New Zealand. So the idea is that it allows people in the industry who have been in for a long time, like I said, to give back to the industry and help the the younger ones that are coming in to really learn to enjoy the career as well. So it's really great. Jason Hull - DoorGrow (04:04) Yeah, you know, it's amazing how much help is available and how willing people are to help. Yeah, I'm reading a book right now by Simon Squibb, I believe is his name, something like that. And it's it's about like following your dream and having a dream. But he said he created an organization that. I guess over in the UK, but he created this organization that allowed people to either help. fun people's dreams or for people to get their dreams launched. And he said that they had way more people. He thought everybody would be wanting to get the dream and their own dream met. He said they had way more people offering to help those that had a dream. And so, and he was talking about how much help is available. So. There's so much help available out there. And a lot of times we just don't ask as entrepreneurs. know, there's this funny thing that when we start out as an entrepreneur, we've kind of come through this whole world where we're such a minority, because most people on the planet are not entrepreneurial currently. And so we get a lot of feedback that we're weird or that we're different or that we're strange. And so we learn to kind of isolate. We start to recognize, I'm different and there isn't a lot of help or support. which is kind of an inaccurate viewpoint, but we kind of view ourselves as an island. And then we start our journey as an entrepreneur and we usually think we're gonna do it all ourselves. We're gonna read the right books and watch YouTube videos and we wear it as a badge of honor. I'm gonna get this thing started and do it all alone. that's, as I say at the end of my podcast each episode, that's the slowest path to growth is to do it alone. Ashleigh Goodchild (05:40) I think as well, like we find that a lot of people are really great at their jobs. They're either, you know, great property managers, great BDMs, and they have people around them that say, you know, you're so good at what you do, you should go open up your own business. And I don't think people actually realize there is, it can be really hard to start your business. I mean, you've got the logistics side of things, but you just assume the phone's going to keep calling and start calling as soon as you're out on your own. Jason Hull - DoorGrow (06:02) Yeah. Ashleigh Goodchild (06:09) And I think that that's one of the biggest things that I see people underestimate. And so to be able to give them that support and not be forced to sell their business because it's just got too stressful. I've got one of my clients where she had her own property management business when she was in her twenties. And she ended up selling it because it was just too much to handle at that age. She didn't have the support, you know, 10, 15 years ago. Jason Hull - DoorGrow (06:14) Yeah. Yeah. Ashleigh Goodchild (06:36) And I remember her saying, I wish PM Collective was around because I wouldn't have sold my business. But now I can have the stamina for my business because I've got that support around me. So I think that that's where I'm seeing a really big gap. people who think, you know, people who are great at their job, which means that they think they're going to be great at business ownership, which is not always the case as well. Jason Hull - DoorGrow (06:57) Yeah, there's a great book on that exact subject. It's called the E-Myth, the E-Myth Revisited. And in this book, E is entrepreneur, it's entrepreneur myth. And basically the summary of the whole book is if you think you, if you've learned how to do the technician level work, you like you have learned how to bake really great cakes. The myth is that now you think, well, I could go start a business and start a bakery making cakes. But a business involves a lot more. A business involves marketing, sales, accounting, you know, a lot of different stuff that is outside the skill set of baking a cake. And so the same thing with property management. Some people are like, I've managed properties for a while, or I've done business development for a property management company, done sales for a while. And they think I could now go start a business doing this. And that's the technician level work. That's not the business ownership type of stuff. then that's where things get a little more difficult. Yeah. Ashleigh Goodchild (07:57) read that book it's actually a really great one for newbies in the business. Jason Hull - DoorGrow (08:01) Yeah, yeah. So yeah, I love that. So how does the PM collective work? How are you getting people together? How do you facilitate this? What does a typical meetup look like? How do you make these connections? Ashleigh Goodchild (08:13) Yeah, so we very much just have hosts that reach out to us and they see a gap in their location. And then they just give me, they have to give me three dates, times and locations. And I just set them up online for them. So it's relatively easy for the host. Everyone just rocks up. It's very, very casual. They grab their own coffee, they take a seat and the host is there just to sort of welcome everyone and sort of facilitate it to a certain point. We have the groups, they can range anywhere in size between four people to 20 people. And to be honest, even the groups of four, I find are so important because I find that the intimate conversations are so much stronger in those small groups and people really open up. And the conversation could be about anything. It could be about... certain products that we're using. might be about some subscriptions. It might be about what's currently not working, what demos we've had, what problems we've had. And I find in that smaller group, people definitely open up a lot more and get that real, really good support that they need. Sometimes it's we chat on a personal level. Again, that comes down to people that are personally happy, I believe make the best. employees and their best employers. And it's really important that we look after people's personal state and having those personal conversations and those opportunities to vent, think are incredibly important in that environment as well. And then we have a big mixture. So we've got some groups where we get a lot of BDMs come along, some where it's just the solo printers, some where it's the referring partners, they sort of just all find their own vibe. But one of the biggest things that has been really important is that consistency. So knowing the for the public to know that we're going to show up every single month at this location. And we're here if and when you need us. That consistency is really important. So really casual, you don't need to buy a ticket or anything like that. And I think that really what's made them successful though is that consistency. Jason Hull - DoorGrow (10:15) Got it. So is how does the PM collective have the bandwidth to facilitate this? How do you guys make money? How does that work? Ashleigh Goodchild (10:23) So we don't, we sort of run it as a bit of a not-for-profit, even though it's not registered as a not-for-profit. So the purpose is very much community-led learning. And I guess on a personal level, I run my own business, my own real estate business. So for me, that's my bread and butter, and this is really what's considered my passion project. So this is sort of more my legacy, I guess. And, you know, I've got the time and the energy. Jason Hull - DoorGrow (10:27) Okay. Ashleigh Goodchild (10:48) to and the love to do it. So that's what I do. We have got great sponsors who help support our podcast and cover the cost for the membership and things like that. And we've got a membership base, which would be say, I guess on the smaller medium size. And over time that will grow. But for now, the support is really where it's at and we're driven by that with no need. for any strong monetary value coming through at the moment. That might change in 10 years, but for now and the last five years, it's been perfect. Jason Hull - DoorGrow (11:19) Well, mean, it sounds like the people that are really giving to this community like yourself probably have some of the healthiest businesses because the people that are in over their head don't have time to go hang out or go to lunch or to meet up with people. so, you know, that, and that, you know, that allows people to come in that maybe they're are struggling to meet and hang out with people that are in a healthier place and kind of lend them a hand up. Right. So. Ashleigh Goodchild (11:32) No. It's interesting because in Australia, we've got what we call CPD points. don't know if you've got them, where they're like compulsory development points that you've got to do to hold your registration. and our events, they are not CPD registered, which means that people don't come along because they are coming because they just have to be registered and they just have to do so many points. They come because they actually want to come along. Jason Hull - DoorGrow (11:57) Okay. Yeah. Ashleigh Goodchild (12:12) And I think you'll find that that has made a massive difference with the vibe. Like we had an event the other night, because we sort of run the separate events as well. And, you know, everyone comes along, they're catching up, they haven't seen each other for a couple of months. And it really feels like someone's birthday party. But the important thing is that people are there because they want to, not because they're going to get a CPD point attached to it. And you really can feel that difference in the vibe. Jason Hull - DoorGrow (12:37) Got it. Okay, well, let's take, I'm gonna do a quick word from our sponsors. This will be relevant. If you are a property management business owner, you're tired of getting tangled up in numbers, KRS SmartBooks has your back. They specialize in property bookkeeping for small to mid-sized managers who'd rather focus on, well, managing. So with over 15 years of experience in real estate, accounting, they're pros in Appfolio Yardi and all the top property software. Trust them to make your monthly reports hassle free so you can get back to what really matters running your business. Head over to KRSbooks.com to book your free discovery call. And so maybe that'll help you have a little more time to get back to the property management community. All right. So back to what we were talking about, Ashleigh. I love, I love this idea. I love that you've facilitated this vehicle for everybody to get together. You just, resonate positivity and I'm sure that kind of sets the tone for the group that people are kind of attracted to. And I've been part of groups where the leaders are very positive and it's just a different category and group of people. There's a lot of people that are helpful, positive. I'm in masterminds like that. And then there's others where the leader is more kind of like a dictator cult leader and like, it's just a very different environment. And there's a lot of guilt and a lot of shame and stuff like this, right? and, I've been in some men's programs and things like that that were like that. And it's just, you know, it's a totally different environment. So you've created, and so this is really, I think a strong Testament to you. How many, how many people are involved in this throughout Australia and beyond. Ashleigh Goodchild (14:13) should know the answer to that and I don't. And I would probably say there would be around 20 hosts around Australia. So 20 people, have started having visionary leaders in each state and to help sort of help me control the states. But yeah, about 20 hosts. But then like I've got, for example, an audio summit coming up. Jason Hull - DoorGrow (14:21) Wow, OK. Yeah. Ashleigh Goodchild (14:37) And that's got 17 leaders in Australia doing an audio summit for me. And we're doing 17 days of tips and tricks. So there is a lot of people that make up all of this, a lot of other coaches and trainers that give their time and their knowledge as well to it. So it really is a big project. in total, I'd say there's probably about a good 40, 50 people from coaches, trainers, leaders. who facilitates some sort of knowledge base for me on all these events. So pretty lucky. Jason Hull - DoorGrow (15:07) So describe to me the difference between structured management and random leadership. Ashleigh Goodchild (15:13) Yeah, so that's something that I practice inside my real estate at SoCo. And one thing that I've learned from other people and other leaders is when we do, obviously you need structured management, in terms of processes and procedures and all of that, and that's fine. But when it comes to leadership, sort of what you talking before about the dictatorship, I feel like I probably practice servant leadership a lot more. practice servant leadership at SoCo, which is the real estate, and I practice servant leadership in PM Collective. And very much I do picture myself or feel that I'm a leader from the bottom and that you just tell me what you need and I will deliver it for you. So I do that both in PM Collective and SoCo. And that's where the support comes from. The random leadership, I think, has been something that has really helped me keep long term staff. I'm known in the industry for having a long term team. anywhere between sort of seven years and 15 years average for property managers, which is great. And one of the things I would say have helped me and I have to say I haven't done this on purpose. It's just the way that I've done it. And I now I reflect back on it. I can see how it's worked. And if we were to every single year, give our team a Christmas bonus every single year, they're going to expect that. And if one year you don't do it because you can't afford it or something's changed, people are going to start getting a little bit ticked off because it's like, where's my bonus? get one every year. And I think the same goes with the Jason Hull - DoorGrow (16:52) become expected. Ashleigh Goodchild (16:54) very much expected. And I think when we start getting, creating expectations with our team, that's when we can start getting a little bit of conflict. And I've seen it in a lot of agencies. So where I, I, I think what I think works really well is things like we might as an office randomly buy someone a coffee, or we might just randomly say, Hey, let's go out for lunch, or randomly, we'll do a Christmas bonus randomly. We might shout everyone a voucher for a massage. All of those random things mean so much more to your staff and they appreciate it so much more. Even if it was that $5 coffee or that random walk or that random time that you're giving, I just find that that doesn't set up expectations and people appreciate those little things a lot more. And like I said, it's not something that I went and said to myself, this is how I'm gonna manage my team. It's something that I just did naturally, probably because I'm a little bit scatty and I probably was, you know, not very good at keeping things consistent. But now that I look back on it and I can see that that 100 % has played a massive part in creating a really healthy long-term team. Jason Hull - DoorGrow (18:07) Yeah, that makes a lot of sense. know, yeah, giving gifts means a lot more or giving experiences or doing things means a lot more than, you know, than just a bonus that they're expecting at the end of the year. And most people aren't actually money motivated. BDMs usually probably should be a little bit and maybe entrepreneurs, but that's the mistake entrepreneurs make is that we assume everybody else likes money as much as we do. A lot of times. And so we try to bonus people or reward people or motivate people with money. And a lot of times that backfires. And because most people aren't money motivated or money driven, know entrepreneurs listening right now are like, what? That makes no sense. I don't understand it, but yeah. Ashleigh Goodchild (18:48) I think a lot of businesses as well, they try to manage their team by textbook and you know, the textbook says, we should give people their birthdays off or a textbook says we should, you know, we should do a bonus at Christmas or whatever it might be. But I think, you know, really getting to know each person and I know who in my team values me sitting down and talking to them and asking them how their weekend was. However, if I went and did that to someone else in the team. That'd be like, you just go away. I'm trying to work here. And I, I, I, yeah, I know what, what each person needs to be happy. One thing that I found more recently is that if your team can have a hobby, that is probably the biggest thing to create a happy team and hobbies prevent burnout. And I think that when we get a lot of people in the industry where all they do is work and family, work and family, they don't have anything in between. And so like one of my girls, she loves to play golf. She really young girl, 21 years old, plays golf semi-professionally. And she had asked whether she can start having some private coaching on Tuesday afternoons. So she was going to come in a few hours early. And I was like, absolutely no problems at all. Because if I give her that Tuesday afternoon off to go play golf, there's something else that she loves. I just find that, you know, people have to have other things they love just besides, yeah, besides the work and family. And that's something that I feel like I really try to encourage with everyone in industry is find a hobby if you're feeling stressed. And you know, and a hobby is not, you know, reading a book or something like that. It's actually like playing pickleball or netball or coaching a team or it's something specific. Jason Hull - DoorGrow (20:37) Got it. OK, so you're encouraging team members to have hobbies. And that allows them to maybe have a little bit more to bring to the table in terms of energy and life, it sounds like. Yeah. Ashleigh Goodchild (20:42) 100 % Yeah, yeah, it just allows them to enjoy enjoy work. And like I said before, you've got to have them they need to have a happy home life for them to perform well for your clients. It's really, really important. You can't, you can't have them having a tough personal life at all that's going to affect you and your clients. Jason Hull - DoorGrow (21:10) Got it. Yeah. Yeah. There's a, there's a really good book called giftology by John Rulin. And he talks about the benefit of giving gifts, gift giving, to basically for almost as marketing or do increase referrals or to increase retention. But the same thing applies to team members. These doing these random things, sounds like a really solid idea. And then also encouraging hobbies I think could be really beneficial. So, So explain your vision for a more human and less transactional industry. Ashleigh Goodchild (21:43) So in Australia, have starting to become quite reliant on our offshore staff and our offshore team. And I'm assuming that that's everywhere. Would that be the same with your businesses? Jason Hull - DoorGrow (21:55) Yeah. Yeah, I would say so. There's a lot of people that are hiring VAs in the Philippines or Mexico for sure. Ashleigh Goodchild (22:02) Yeah, I mean, and whether it's part of your business plan or not, you know, I fully respect that. But what we've found in businesses is that by passing on the transactional work to our offshore team, and transactional, mean, collecting the rent, arranging maintenance, sending out inspection letters, you know, all of that sort of admin tasks, we're finding that that's really not where the value of a property manager or business owner is anymore. Jason Hull - DoorGrow (22:19) Mm-hmm. Ashleigh Goodchild (22:31) And so what we need to do is to move our skillset into more of a consulting role. We currently have been doing for a number of couple of years and I teach this a lot to other officers is what we call an annual investor audit. So our annual investor audits, they are 30 minute consults with every client and we are going diving straight into all the holistic side of their property because we need to make sure as a business that our clients are emotionally well and financially well. If they're emotionally and financially well, they're going to keep their investment property. The minute that they're stressed and not making money is the minute that they sell. And obviously that's not what we want in the businesses. So to do that by checking in with them, we are talking to them about any red flags we see with their tenancy with their rent or their inspections. Jason Hull - DoorGrow (23:10) Yeah. Ashleigh Goodchild (23:27) We're talking them through and helping them understand what level of maintenance is considered normal or excessive in their property. If they're not spending enough maintenance, we're talking to them about ideas they've got for future renovations. We're talking to them about what their mortgage rates doing, how are they feeling? Are they positively geared or negatively geared? Is there any circumstance that's coming up in the next 12 months that we should make a note of that might cause them a little bit of stress? We are... Talking about all of those things on a real conversational level and it allows us to pick up trends of what that client's plans are. Are they planning on building a portfolio? Are they planning on selling in six months? Are we going as an office to see a huge wave of clients starting to sell? Is that something we need to protect that, you know, as an asset in our business? And so when we start getting into that consultancy role, it's no different to your accountant organizing a tax planning meeting. you know, in April, for example, that's exactly what we're doing. And we are planting seeds for that client so that they're never surprised when we call them up to say, Hey, your rent's gone backwards, or you got to spend $10,000 on the property. And that has been incredible. It's not only been something that's helped our churn rate. Generally in Australia, churn rate and loss rate for businesses can range anywhere between sort of 15 and 30%. Our office is sitting at about 5%. For it so for a large, a large office with we've got 1200 doors, to have that sort of 5 % churn rate is is actually considered really great. And I do put that down to the annual investor audits. And in addition, though, it allows the business owner Jason Hull - DoorGrow (24:52) Yeah. Ashleigh Goodchild (25:10) to take control of their asset and not to have to maintain that relationship. Because at the end of the day, I'm very passionate about that that client is my client as the business owner. And I need to keep that relationship up. And if I put all of that responsibility onto the property manager and my property manager leaves, I've got a risk that that client is going to follow the property manager. So that's a little bit of my of the importance and responsibility I take as a business owner. So they have been an incredible game changer for retention, but it's also helped uncover new business opportunities because when we've done these for our clients, we've never sort of asked them, do you have any properties? But so many clients have actually said to us, that was so good. Can you do it for my other property? And I'm like, sure. Where's your other property? and got the address and we've subsequently got the business of the because the other agencies weren't doing it. So obviously over time, more offices will start doing it. But that's just a great example of elevating the human side of property management. And we started introducing these in our business, like I said, a couple of years ago, I now teach them to other agencies around Australia. And then as soon as we can get, you know, a really good percentage of businesses, all bringing these in as just a natural part of the business, then we will that's how we see the industry elevate. And then that's just going to be considered a normal thing like checking rent arrears. And so that's really my vision to, to bring in things like that. I've been trialing, I do a lot of like mirroring in the business. So I trial things in my business first. And if it works, I will put it out to the industry. the other trial that I did was, which actually didn't work. And, it was about, I had a junior property manager and we had a lot of clients that we were losing from, from fees from owners being fee driven. And I thought to myself a little bit like a hairdresser. You've got a junior apprentice to cut your hair. You've got a senior stylist or you've got the director. And I thought to myself, I'm actually going to do a fee schedule with a junior rate. So if you want to, if you're fee driven and you want a junior to look after your property with less than one year experience, this is the fee. And if you want a senior, this is the fee. Now I thought that everybody would jump at the junior fee schedule because everyone seemed to be fee driven. What was so interesting is I did this trial for 12 months and I probably had 3%, maybe 2 % of clients actually say, I'll go with the junior fee schedule. Every single person said, thanks, but I think I'll stick with a senior. And I think that that's a great example to showcase that investors do want the experience. They want the peace of mind. And we all thought they wanted cheap fee schedules, but when given the opportunity for the cheap fee schedule with a junior, they didn't take it. So I thought that that was a really good example. Yeah, I know. Jason Hull - DoorGrow (27:49) Mm-hmm. yeah. I could talk about that for an hour. We've tested a lot of stuff on pricing. Ashleigh Goodchild (28:10) But it was just a great test to do. I trialed it, it didn't work. So I've gone to the industry and I've said, given it ago, it hasn't worked. I'm now trialing a second option with fee schedules. And hopefully that works because I just feel like the industry needs to move just from the same fee schedules we've been doing for 20 years. It really is something that needs to be done there. So that's my next mission. Jason Hull - DoorGrow (28:14) Yeah. Yeah, I love it. I love the experimentation. So cool thing about my position is I get hundreds of guinea pigs. And so I do all sorts of testing. And so we could chat about some of that. We've done some fun stuff, but I love the idea of the annual investor audit. call those, we coach clients on that as well. We call those annual portfolio reviews and that's a great opportunity to get more referrals. great opportunity to get more reviews and testimonials. It's a great opportunity to create more connection with the client and to showcase what's invisible to them currently that you're actually doing work. And yeah, and it's going to significantly decrease churn. You mentioned churn maybe between on a lot of companies, maybe being between 15 to 30%. And if you're at 1200 units, I was doing math while you were talking, that would be between 180 to 360 units being lost each year. And so a lot of property managers don't pay attention to what's leaving and they think, well it's infrequent or they're selling their properties or whatever and they're not paying attention to that. They're so focused on how do I get more doors? And sometimes they're losing more doors than they're adding each year or they're just breaking even. And so they've been at the same spot for like a decade sometimes. And they're wondering, why does this feel like a grind? And they're not making progress. And sometimes you have to look at what you're losing and what's your level of service that you have there and how visible is what you're doing to your client? Because if it's not visible, they're going to assume, well, why do I even pay them? They're not doing anything. They're just collecting rent. Yeah. Ashleigh Goodchild (30:15) Yeah, it's like, I call it a, we've got a client success manager. And I think that that's a real missing part in a lot of businesses because we've got the BDM who brings in new business. We've got the property manager who maintains it, but the client success manager actually is what I call a BDM in reverse, because if they can prove your retention, that is growth. So therefore it is still a BDM role. Jason Hull - DoorGrow (30:21) Mm-hmm. Yes. Yeah. Ashleigh Goodchild (30:41) that you've got someone specifically for. So that's a real big missing part. And I think a lot of businesses when they don't have somebody specifically on that role. Jason Hull - DoorGrow (30:52) Yeah, I've been privy to see inside of a lot of different types of businesses and being in a lot of different masterminds. And one of the things that I've seen is that some of the most sales oriented organizations, like companies that they're focused on placing salespeople and hiring salespeople and stuff like this, they always have their best salespeople graduate to be on their client success team. is how they kind of position it. And they call that their second sales team. Because these are the people that get people to re-up or renew or continue on, or to bump up into a higher level program. so client success is your other sales team. their whole job is to decrease churn. Their whole job is to increase retention. So at DoorGrow our client success manager is my oldest daughter. And she does our client success. And she's got the personality for it. She's much more of a feeler than I am. She's much more about community than myself, right? I'm more of a logical thinker in a lot of instances. And so clients just love her. She does a great job. And so everybody should have client success. What's funny is in the property management industry, you hear the phrase property manager, but that's like this mystery sort of title that means a different thing to everybody you ask. And so for some of them, some people think their property manager is supposed to be a BDM also. I'm like, those are... probably different personality types. Some think they're the maintenance coordinator, but then they'll hire a maintenance coordinator and they call somebody else a property manager. so property managers also could be those client success people, the relationship builder. And so that's where it gets confusing is when we're, I hired a property manager. Well, okay, what are you having them do? I always have to ask because it's always different. So I don't know if you've noticed that in Australia, but. Ashleigh Goodchild (32:41) Yeah, and I think as well, like, I like what you mentioned before about how a lot of people don't actually see what we do. And I think that's where you've got the opportunity. Because I remember a long time ago, a client said to me, you know, wanting to negotiate on fees after a couple of years. And he said, you know, your job's easy, you don't, you know, the you don't have to do anything for your money. So therefore, you should reduce the fees. And I'm like, Jason Hull - DoorGrow (32:49) Yeah, it's invisible. Ashleigh Goodchild (33:07) Hold on a second, we've chosen a fantastic, perfect tenant. We do a lot in the background to make it look like we are managing it nice and easily and not creating any stress for you. Do you want me to create a problem tenant so it looks like that I'm doing work so that you can justify the fee? Because the fee is so, is reflective on you finding, it look like that we're having a very easy life. but that's taken a lot of skill and experience to do that. It's just so backwards, isn't it? That the way that they validate our fee, if we have got lots of problems and they think we're not worth our fee when we've got nothing to do and got a perfect tenant, which was the result of us putting it in the first place. Jason Hull - DoorGrow (33:34) Yeah. Yeah, I used to work in IT and one of the things I learned in doing IT and working on computers and networks is that if you make everything run perfectly, they wonder why they even pay you at all. And then I also noticed if there was a problem, they're like, why do we pay this person at all? There's now this problem with the network. so either way, couldn't win. So I learned I had to make the invisible visible. I had to tell them all the time, hey, I just updated this server. I just changed this. This has been improved. That's preventing these problems. And they're like, wow, Jason's on top of this. Jason's making everything run smooth. So I had to learn to be noisy. I worked at Hewlett Packard and I was in Boise, Idaho and I had a boss in Texas. And he would just look at our... he would message us all throughout the day through an instant message app or whatever. He would message us, what are you doing? What are you doing? And I was like, he can't see what we're doing. So I just started changing my status. I allowed you to put a little status, they use some Microsoft app, I can't remember Teams, I don't remember what it was. But I just would update it every day and I would say like throughout the day what I was working on in that moment. Updating this, working on this, doing this, and just what I was doing. And so then he started asking, what's your coworker? doing because we were a two person team that were over a big system. And he was like, what's what's what's Josh doing? Is he working? What's he? So he started to perceive that I was on top of things and working and this other person was lazy and not doing stuff. I'm like, no, he's working too. So yeah, but that's I sold, you know, we've translated that to helping clients make sure you're showcasing the invisible because they can't see it. Otherwise, you have to be noisy. And those annual reviews are a great opportunity to do that because you say Here's how many maintenance requests we've handled that you didn't have to deal with. Here's how much money has been collected. Here's the payouts that we've done to you. Here's all the stuff that we've been taking care of that's prevented you from having to deal with this. Here's how many calls we took. Here's how many tickets we handled. All these vanity metrics justify why they spend the money with you. So I love that you're reinforcing that idea. So for my clients listening. She said, and she's got 1200 doors, which is probably more than some of you. so Ashleigh, what do you feel like people are hearing your low churn rate besides the annual investor audits that you do and maybe having a client success manager. I don't, what, what do you feel like is really significantly reduced the churn rate down to 5%. I mean, that's significant in any business. Ashleigh Goodchild (36:25) Yeah, it would. You've got your audits, it would probably be I think myself being a director of the business who is 100 % active in property management and approachable is a really important word. Clients know that they can call me at any time they know that if one of my property managers is on leave, they can call me to handle anything that plays a massive part. And if I reflect on some of my clients, because we all get clients that, you know, maybe aren't happy with something or a little hiccup has happened, to know that my clients don't just silently leave and say, that happened, not happy, I'm gonna go find someone else. They always contact me first. I actually had one the other day to say, Ash, my property manager is really lovely, but I'm just feeling like I need someone with a bit more confidence. No problems at all. Let me move you to this person. The fact that they approach me first and give me the opportunity and know that they can call me to move them. I just take that with so much privilege because that doesn't happen in a lot of offices. If you're not approachable and your client would rather just leave the property, then bother coming to you because they don't think they're going to get heard. That's going to be a problem. So for me, that is massive. Jason Hull - DoorGrow (37:24) Yeah. Ashleigh Goodchild (37:46) And then probably the final thing, I think that our values really show through, through social media and my presence on social media, the fact that they know me on a personal level, they can see that I've got kids, they can see that I've done podcasts, they can see when I win awards, and embracing our clients on our journey and allowing them to see every part of me as a human being, I think is great. We do an annual an annual drive for a not-for-profit. support DB survivors quite a lot in our business and we promote philanthropic investing. And so the fact that we bring in our clients to be involved in that process by buying their clients, their tenants a hamper for Christmas to strengthen relationships has been a fantastic PR exercise with clients saying, you know, yes, please organize my 10 Christmas hamper and we're just so thankful to be aligned with a business like yours that supports, you know, good causes. It's those little things that I've probably played the biggest part in it, in their retention and client success. Jason Hull - DoorGrow (38:49) Love it. Yeah, I love that. A lot of property managers are so focused and business owners are so focused on thinking, what, how do I get more money? How do I take more instead of like the benefit of being involved in how much trust it would create to be involved in some sort of philanthropy or charity or something that's a bit more outward focus. And, and one of things we are really big on at DoorGrow is coaching our clients on finding a, in building out their client centered mission statement is figuring out. How do you make this vision bigger so that you're having a positive impact, not just for yourself, for the business, for your team, but maybe the community at large, maybe the industry at large? And what sort of impact and change do you want to see there and making that vision bigger? Because it allows you to attract team members that are inspired by a bigger vision, allows you to attract clients that resonate and are inspired by a bigger vision. And so you get better people all around. Ashleigh Goodchild (39:48) And it gives other people the opportunity to do good. And with our annual hamper drive, we did that last year. And all we did, we aligned ourselves with a not-for-profit hamper company, which is sort of like a by-product of one of the charities. And they support women getting back into the workforce. And so not-for-profit, we emailed all our clients and we said to our landlords, listen, if you've had a great year with your tenant, we would love to arrange a hamper on your behalf. It's $88. Jason Hull - DoorGrow (39:53) Yeah. Ashleigh Goodchild (40:16) and we'll take it from your rental income and we'll send it on behalf of you for Christmas. It's a great way to acknowledge you've had a great experience with your tenant and strengthen that relationship. And from that alone, just us doing OneDrive last year raised 14,287. And so this year we have now through PM Collective promoted that through other agencies to do the same. And I actually had an email from the CEO of the not-for-profit today and she said, Ash, I am just so excited to get these numbers back to you. We have had such a huge response from you and assitting against it. And I just can't wait to see what the figure will be because I know as an agency, we will do probably double and the fact that other agencies now will do good. It's just an example of the impact that we didn't realize we were having by giving our landlords the opportunity to do good, but then sharing that with other people to give them the opportunity for their clients to do good. It's just so wonderful on so many levels. And it's the same with our philanthropic investing. encourage owners who financially are able to rent out their home at a low market rate to a survivor of DV. Jason Hull - DoorGrow (41:19) Love it. Ashleigh Goodchild (41:29) to do it and you'll be surprised at how many people don't even know it's an option. It's not saying that it's right for every landlord, but there are so many landlords out there who have a vacant property and didn't even know that they could do this jump on board. yeah, giving those opportunities to people that didn't know that it was an option, I think is really great to see. Jason Hull - DoorGrow (41:50) Yeah, love it. mean, people want to feel good about themselves and, you know, being able to give gifts or being able to benefit others makes people feel good about themselves. And if you're giving your clients a chance to feel good about themselves, they're going to associate that with you. Yeah, that's beautiful. So, well, cool. I love all these different ideas and tips. think you've shared that. I love the idea of doing the annual portfolio reviews. love the idea of, you know, the Ashleigh Goodchild (42:04) Yeah. Yeah. Jason Hull - DoorGrow (42:18) charitable stuff, the philanthropy stuff. Love the idea of giving people a vehicle or some method to bypass the frontline staff person that they're assigned so that they can reach somebody that can maybe, if they want to complain about that, that team member or some, there's a, there's a gateway there or a vehicle there for them to do that rather than them just going, well, I guess I have to quit. I don't know. Yeah. So I love, I love these ideas. that I think anybody listening to this would benefit in decreased churn. Ashleigh Goodchild (42:40) Yeah. Jason Hull - DoorGrow (42:47) Well, Ashleigh, I appreciate you coming here on the show. How can people maybe get in touch with you or with your business or whatever you would like to share with others here in closing? Ashleigh Goodchild (42:58) Yeah, well, I mean, I'm very easy to Google. You can just Google Ashleigh Goodchild and hopefully find me there. But I am on Instagram and all the socials under PM Collective or under Ashleigh Goodchild. So I'd love to connect with anyone that finds me on those platforms. Jason Hull - DoorGrow (43:16) Perfect. All right, Ashleigh. We'll probably have to have you come talk to our clients sometime. I think that'd be fun. So, all right. Thank you, Ashleigh. Appreciate you coming here on the show. All right. So for those that are struggling in your property management business and you want to kind of get to that next level, make sure you reach out to us at doorgrow.com. We would love to facilitate or help you or see if we could help you with your business. Ashleigh Goodchild (43:21) Love them. Thanks for having me. Jason Hull - DoorGrow (43:41) If you felt stagnant for a while, also join our free Facebook, just for property management business owners at doorgrowclub.com And if you would like to get the best ideas and property management, join our free newsletter at doorgrow.com/subscribe And if you found this even a little bit helpful, don't forget to subscribe and leave us a review. We'd really appreciate it. And until next time, remember the slowest path to growth is to do it alone. So let's grow together. Bye everyone.

DGS 315: The Myth of Needing More Property Management Leads

When trying to grow your property management business, have you ever thought to yourself, "Man, it would be great if I just had more leads?" In this episode of the #DoorGrowShow, property management growth experts Jason and Sarah Hull discuss the Leads Myth and how "just having more leads" will not actually help you grow your business. You'll Learn [02:06] The Myth of Needing More Leads [11:39] Leaks in Your Sales Pipeline [22:41] The Future of SEO with AI Quotables "Why do we call it the leads myth? Well, the myth is this lie that we believe that you just need more leads. And the assumption in that is that all leads are the same." "The more clarity you have, the less wrong stuff you're going to be doing." "Not all clients are equal, right? Which means not all leads you get are equal. You need to qualify them." Resources DoorGrow and Scale Mastermind [https://www.doorgrowacademy.com/courses/mastermind] DoorGrow Academy [https://www.doorgrowacademy.com/] DoorGrow on YouTube [https://www.youtube.com/channel/UCC1mGYT2Sw0LOe32hO_QdNg/featured] DoorGrowClub [https://doorgrow.com/] DoorGrowLive [https://doorgrowlive.com/] Transcript Jason Hull (00:00) Most of the industry is trapped in a cycle of suck. This is why most property managers suck in most markets. Maybe even you that's listening. We are Jason and Sarah Hull, the owners of DoorGrow, the world's leading and most comprehensive coaching and consulting firm for long-term residential property management entrepreneurs. For over a decade and a half, we have brought innovative strategies and optimization to the property management industry. We help people grow their property management businesses quickly. And our mission is to transform property management business owners and their businesses. We want to transform the industry, eliminate the BS, build awareness, change perception, expand the market, and help the best property management entrepreneurs win. Now let's get into the show. All right. So today we're going to be chatting a little bit about the leads myth that a lot of people believe. So if you have ever thought to yourself, I just need more leads. If I just had more leads, everything else would be great in my business. What do you have to say about that? Well, I think that is not the case. Okay. It's definitely not the case. And I also think almost kind of be careful what you ask for a little bit. getting a whole bunch of leads was never really the best. strategy anyway, unless you have people who are just picking up the phone and calling you and saying hey, I Would love for you to just manage my property. I don't have any questions. Here's my money. I just had a contract Those are leads I want but cold leads that are Not ready to go that need to be warmed up that have a bajillion questions That might not even understand why they want to work with you Specifically, yeah, I'm just not interested in those leads. And the other thing I think we need to discuss on this episode specifically is the changes that we're seeing because of AI. So AI is really great and also it's changing things very rapidly and leads and SEO that's very effective by this too. Okay. So. Let's get into this. So a lot of people believe they just need more leads. And the danger in that is if you really just think you need more leads, you're going to go out to the marketplace and talk to marketers and they're going to go, cool, I'll give you leads. And they will sell you leads basically. So why do we call it the leads myth? Well, the myth is this lie that we believe that you just need more leads. And the assumption in that is that all leads are the same. And they're not, they're not even remotely the same. So there's a couple of different frameworks that we usually talk about to kind of destroy the leads myth. One is the four Ds to revenue. Another is the cycle of suck we talk about and how people get stuck in growth. We talk sometimes about the pipeline leaks that you have in your pipeline. And we talk about the myth of SEO or internet marketing. And then we often talk about any others warm versus cold leads and then David versus Goliath. Okay. So we can tackle these all really quickly and go through each of these and maybe some other things will pop up as we go. Cool. Let's talk about all of that and then we'll talk about why AI has changed all of, really all of those things. Okay. That'll be in conjunction with SEO. All right, so let's go through these. And so for those following along, if you stack all these concepts, each one compounds your speed of growth. They're all related. And so these are frameworks that I love to share with clients to help them understand so that they don't make the mistake of doing the wrong stuff. The more clarity you have, the less wrong stuff you're going to be doing. The less you're going to be experimenting, the less you're going to be wasting time. And if you really wanna collapse time, the easiest hack is reach out to us and we can help you with all of this. We've been doing this for over a decade and a half. We have had hundreds of guinea pigs to figure this all out and we have over 100. case studies and testimonials more than anyone else in the industry. All right. Let's get into this. let's talk about the four D's to revenue. So these are four numbers when multiplied equal the gross revenue in your business. And I sometimes call them the four doors to revenue. And I showed four doors with a little multiplication X next to each of them equals your money. Right? So not all leads are equal. So the, these D's are, if you want to write them down, they each start with a D. It is Deals, doors, duration, and dollars. Okay? So the first is like how many deals is this client going to bring you? Not all clients are equal, right? Which means not all leads you get are equal. You need to qualify them. And how many doors are they bringing to the table? Or how many doors per deal are they bringing? And then the third D is duration. How long are they going to stick around or be involved in property management? is are they an accidental investor that's going to stick around for maybe a year, or are they in the buy and hold game and they'll be around for 10? And then the last D is revenue or is dollars. And so are they a cheapo? Are they a premium buyer? Where do they kind of fit? Or are they somewhere in the middle, like the normals as I call them? So we've got these four Ds. So let's play a quick example. Let's take the accidental investor. They couldn't sell their property. They wanna get it rented out. How does this play out in the 4Ds? done one deal. They didn't mean to do a deal, but they did. And it's usually just one door. Maybe sometimes they have two, but very often we just see one door and they're not looking to... to do more deals because as soon as the market spikes and the market is hot, they're going to bail. They're going to sell, which means the duration is questionable. Let's say it's like one year, like if they can just get it rented. but it might be a few months because if the market spikes three months from now, they're probably going to dump that property pretty quick. And then. than the dollars, they're not your premium buyers. They're not looking to do a lot of improvements. They're not looking to spend a lot of money. They're the people who, they have this property, they aren't quite sure what to do with it. They figure, let's just see if I can get it rented. They want it well taken care of, but they're not generally looking to spend a lot of money or invest a lot of money in either the property or maintenance or repairs or improvements or a property manager. So they're just trying to... Do what they need to do. It's like the bare minimum in order to get a tenant. All right, so one, one, one, right? Like one deal, one door, one year duration, for example, if this is worst case scenario and you sign a one year agreement with them and they're a cheapo, right? Now let's take a really great scenario. What would be maybe an opposite scenario or a really great opportunity? Like my, I will say my second largest client. He had 42 doors I think was the right answer but I was looking to buy more. So when I took him on he had 42 by the time I sold the business he had 60 something. So he was always doing multiple deals. Yeah. The doors that he had came out of multiple deals. So since he did multiple deals he also had multiple doors. was consistently looking to grow. He didn't want to just stop, you know, at a certain point he was always looking. He also was a buy and hold investor. He wasn't trying to buy these things and then wait, you know, until the market spiked and then try to sell them and make a profit. He wasn't up for the long term. And he was not a cheapo. He wasn't trying to cut corners. He wasn't trying to cut costs. You he wanted to work with. a property manager, wanted to take care of the properties and make sure that they were being maintained properly. Yeah. Okay. So that's a great example that previous client that you had. So let's just say like on each of these fees, we use tens instead of ones, right? Like let's say they do 10 deals over the life of being with you. They've got 10 doors. Maybe sometimes it's 10 doors per deal if they're doing small multis or something like this, right? And then you've got a 10 year buy and hold duration. In this hypothetical example that I just threw out, it would be 10 times 10 times 10. This would be over a thousand times greater lifetime value than that accidental investor in our previous hypothetical. Does that make sense? So are these even remotely equal? No, not even remotely equal. Should you then spend the same amount of time trying to cultivate both of those type of leads? Probably not. Would you spend the same amount of time following up or giving them attention? Probably not. And the great investor clients probably are easier to deal with, less emotional, have a much higher margin and operational cost is lower, right? And so there's a lot of benefits. so this is, we're just talking about the revenue piece, but when we look at the cost side of things as well, everybody knows having a really bad owner that's really needy and difficult and emotional about the property. can be a big headache and a big challenge and you may be losing money on some of those doors. So, four D's to revenue, that's one concept. One quick thing I wanna add to that is where do you think these owners hang out? So, if you've got an accidental landlord and they are looking for a property manager, where might that lead come from? Versus where might the lead of a client that has 42 doors come from? There's a lot higher probability that an online lead is going to be an accidental landlord. It's not impossible to get an online lead that has 42 doors. It's just probably not your norm because the ones that have 42 doors, they aren't really dabbling. They aren't going, oh, geez, I wonder if I should get a property manager to maybe help me with these. They are just a little bit more savvy. A lot of times those aren't going to be the leads that you're getting if you're buying leads. Although those are the leads that you want, it's not going to be the norm that you get. All right, so we're 10 minutes into this. We're going to crank through some of the rest of these. So cycle of suck. Cycle of suck, real simple. If you take on any client, it leads to you having some bad clients. So if you take on bad clients, that leads to you having bad properties, which leads to having bad. Residents or tenants which leads to having a bad reputation or reviews which leads to you attracting more bad clients. So not all leads are good. You don't want to take on every client and you definitely don't want to attract or get more bad leads. And so this is a framework that if you understand you can reverse it and focus on a cycle of success where you're picky about the owners you take on, you're picky about the properties you take on, you're picky about the tenants which everybody tries to do anyway. but those first two steps are supremely important. And then you're going to have a methodology for getting more positive reviews. These are things we help our clients with. And so then you create a cycle of success. Most of the industry is trapped in a cycle of suck. This is why most property managers suck in most markets. Maybe even you that's listening. We want you to get out of the cycle of suck. All right, let's talk about the pipeline leaks. Okay. So usually if I were drawing, I would draw a spigot or a faucet or whatever you attach a hose to, and then I would draw a hose, and then I would draw a little plant or tree that you're trying to grow at the end of the yard that this hose is trying to get water to. Most of you listening think, I just need more leads. This is where the lead Smith becomes really obvious, trying to turn on that faucet even more. I just need more water flowing through the hose. That would make sense, that would be true unless there's a problem with the hose, right? Like the hose has some leaks. And if the hose has some major holes in it, there's not going to be a lot coming out the other end. Sometimes very little at all. And so it's not about how many leads you're getting, sometimes it's just how good is your pipeline? How tight is your product? And so we need to make sure that we get those leaks shored up. And we'll just mention what they are real quick, but. One of the earliest ones that affects you is just awareness. It's going to be your perception and reputation online. It's going to be your website. It's going to be your branding. So they can tell that you are in this industry and that it's clear that that's your focus and it's not real estate or something else. And what else? Your culture and purpose. This is the actual product that you sell. So that is another one. And there are two more. Pricing. Pricing, which everybody's trying to price the same way, 10 % or worse, pure percentage, or they're doing flat fee. We have a different innovative pricing model. If you're curious about that, set up a call with our team. We can tell you about it. That allows you to close more deals more easily at a higher price point. And the last is the pitch, right? Selling. And so if you can dial in each of these leaks, what we've noticed over the years is we can double a company's close rate without changing the amount of leads or lead sources that they're getting currently if we can get those things dialed in. And that's significant. Maybe you don't need more leads. Maybe you just need less leakage in your pipeline. Cool. All right, the next one, you had mentioned warm versus cold leads. Do you wanna explain the difference? Yeah, we can talk about warm versus cold. So when I had my property management business, Yeah. what is a cold lead? So cold lead is someone who really has almost zero, very little familiarity with who you are in your company and your brand and what you do. They don't. they should work with you. That's the big thing is why they should work with you. So they don't know you, trust you or like you. That's a cold lead. And a warm lead. Warm lead would be something like a referral or some sort of recommendation. hey, Sarah is the best, I work with her and you should too. Now they're coming in already feeling like, somebody that I know that I trust recommended this person, so therefore I should also trust this person. So those obviously have a much different close rate. And there are things that you can do to increase your close rate or to warm up deals, of course. But if you're spending all of your time trying to close a bunch of cold leads, which generally is going to be what happens when you're purchasing leads, you really don't get to buy warm leads. Right. They're all cold. I mean, that would be great if you could, but when you're buying leads, you're usually buying a lead that is very cold. They don't know you at all. And oftentimes that same lead is being sold to multiple different companies. There's a lot of blood in the water there. So warm leads versus cold leads, the close rate on warm leads will be really high, like 90 % or higher. Cold leads, like the opposite, 10 % or worse. And so I would rather a client get five warm leads and maybe close four of them than 10 cold leads and maybe get one. The hidden pain point or secret with warm versus cold lead generation. or cold lead strategies is time. Cold leads take a massive amount of time because you have to nurture them and warm them up and build the trust and create the relationship. And even after all of that, and all of sudden done, the conversion rate's really low. So all of you know how high the close rate is if you get a really great word of mouth referral. We love those, right? That's a warm lead. So we have strategies and methods that we focus on with clients to increase the warm leads. while avoiding and doing cold lead advertising and avoiding worrying about cold leads. Once you start getting some growth engines installed for your business that give you warm leads, you're not going to want the cold leads. They feel like garbage in comparison, and you're not going to have time for them. And you're not going to wanna waste time on those because those are often the worst owners. All right. What I would say is as far as getting leads in, if you give me three warm leads, I will take three warm leads over even 100 cold leads. Sure. don't, I don't, I'm not really interested because even if I close, let's say two out of the three warm leads, that's great. What's the close rate on 100 cold leads? If it's about 10%, you might close 10. And some of you might be going, Sarah, 10 is better than two. Yeah, you're right. But how much work did it take for me to close the two versus how much work? did it take for me to close the 10? I would rather close two very easy warmed up leads because I can do that again and again and again. So in the same amount of time, I can close way more warm leads than I can cold leads. So I would rather take three warm leads than a hundred cold leads any day of the week. We have a sponsor for this episode. Many of you tell me that maintenance is probably the least enjoyable part of being a property manager and definitely the most time consuming. But what if you could cut that workload by up to 85 %? That's exactly what Vendero has achieved. They've leveraged cutting edge AI technology to handle nearly all your maintenance tasks from initiating work orders and troubleshooting to coordinating with vendors and reporting. This AI doesn't just automate, it becomes your ideal employee, learning your preferences and executing tasks flawlessly, never needing a day off and never quitting. This frees you up to focus on the critical tasks that really move the needle for your business, whether that's refining operations, expanding your portfolio, or even just taking a well deserved break. Over half of the room last year at DoorGroad Live, our conference signed up with Vendero right there. And then a year later, they're not just satisfied, they're raving about how Vendero has transformed their business, don't let maintenance drag you down. Step up your property management game with Vendoroo. Visit Vendoroo.ai slash door grow today and make this the last maintenance hire you'll ever need. All right. I thought it was a good time because it was a good time. Waste of time and I don't like to waste time and maintenance coordination can be a huge waste of time. Yes. All right. Let's talk about David versus Goliath. So I'll give you an example. We've got a client. that has, so this is dumb David versus smart David, right? The story of David and Goliath, if you're not familiar with the Bible. David goes to fight Goliath. These two warring nations send out their best person and David decides he is not going to wear the armor, the sword, the shield, all the heavy stuff. He's just bringing out his slingshot. He's got his sling, he's got some rock and he goes out to fight Goliath and he's like, I don't need all that stuff. What most property managers do is David basically brought a superior technology. He brought a gun to a sword fight and he was good at this. He trusted himself. He had skill. He had a better tech to beat this giant. He flung the rock right into the guy's head. I had knocked him unconscious or killed him, I don't know. And then he chopped the guy's head off with his own sword. Right. And so that's the story of David and Goliath. So let's talk about the dumb version of David. Like if David wasn't smart. And he said, I'm going to do all the same stuff. I'm going to use the sword of SEO and the shield of pay per click and the helmet of content marketing and the breastplate of social media marketing. And I'm going to do all the same stuff, digital marketing that all the other big companies are doing that are spending two to $3,000 a month or greater. I'm going to go compete with them as a small startup or a small pro. two to 400 unit property management business and try and compete with these big companies that have thousands of doors. One of our clients, as an example, came to us has 6,000 doors. They were spending $30,000 a month doing these strategies to try to grow and it wasn't even working for them. So why would you go and do what the big guys are doing and lose the battle with them and it's not even working for them, right? So that's the idea of David and Goliath. Don't go do what the big guys are doing, find a better way to compete, especially if you're smaller than them. You don't wanna try to outspend them, because that's not going to be possible. right, myth of SEO. All right, and we'll talk a little bit about the future and AI, all right, to wrap things up. So, all of you can go check this out for yourself. This is not me making stuff up. You can go on trends.google.com. You can go look up property management. date it, the time period, to the current time back to 2004, to the present. And you can filter by the US if you want to. What you'll see is that property management search volume, the amount of people searching for property management on Google has not increased since they started tracking data back in 2004. What has increased? The Goliaths, right? The companies spending a lot of money on digital marketing trying to do all this stuff. And so it's created a lot more competition. So this is where we get into another framework that we share, which is the blue ocean versus the red ocean. There's this small little area of the ocean that's red bloody water where all the sharks are fighting over the worst fish, which are these terrible property management business owners that are at the end of the sales cycle. Basically the crappy scraps that fell off the word of mouth table that the warm lead stuff has captured. They're what's left over. And so there's these ugly gross fish and the sharks are all fighting over the worst stuff. And there's this huge ocean full of fish in the U.S. 60 % are self-managing. There's tons of business out there. And so the myth of SEO is basically this, that in order to win the game, you need to have the top spot on Google. Not true. You don't even have to show up on Google in order to go out and be able to create business. Because there aren't really people searching for property management. It's very small. So you don't need to be found on Google. You need to go find owners because the best clients are offline and they're not looking for you and they don't like doing property management and they need you, but they're not looking for property management actively right now. And you can figure out how to go make that happen and we can teach you, right? So let's talk about the future of AI. What are we noticing? Well, I don't think it's any surprise. messed up a lot of Yeah, it's changing everything. AI is going to change everything. And if you haven't noticed it yet, just hold on because you will. It's crazy if you haven't even seen it yet. But it's it's going to flip everything you know upside down, including SEO. Yeah, including SEO. So everyone that is like, no, I don't care. I'm still going to do SEO. That's the only way to go. Like we made a video about this. specifically for this reason, but even the ones who are still clinging to SEO and you just can't let it go and you don't know that there's another way and maybe you don't believe it and you're like, no, I'm no, this is the only thing I'm going to do and I'm going to do this and that's the only way I can grow the business. That is all right and SEO is going to force you to look at that. Okay, yeah, so what we're seeing is search volume on Google is going down. There's less people using Google. More people are now going to LLMs like ChatGPT, Clod, Perplexity, Google's Gemini. So people are using tools now, sometimes within software, and they're using these tools to ask questions, to figure things out, figure out who they should use or who they should choose or what they need. And so Is it still relevant to have good reviews? Yes. Is it still relevant to maybe have some SEO stuff going? Probably, but it's certainly on the down slope and it's certainly decreasing. The game is changing. Even if you search on Google now, the AI at the top will respond to your search request anyway. And a lot of people are just reading that and not really looking at the results below. And so this is the new future. It's changing very quickly. and some are calling it AEO, some are calling it LLM, SEO, there's all these different phrases that are coming out. If you want to do a quick experiment, open up one of these LLMs like ChatGBT. Don't be in your own. It's a large language model. It's basically all these different AI chat tools. So go into ChatGBT. Everybody should be familiar with that by now if you're not. and go to ChatGPT open that up, but make sure you're not logged in or you use a different account and just, or say don't use any of my previous data or open a private window and say don't use any of my previous information or data and say who's the best property manager or what property manager should I choose in X market, right? And see if it comes up. See if your business comes up and see what shows up. And so this is... how people are kind of doing some of their research, but all the stuff we just talked about still applies. Don't think your whole goal needs to be LLM SEO, where you need to start getting these chat tools to tell people. Why? Because most people are not looking for a property manager. They're not looking. They are not trying to find you. That's the mistake most people make. The majority of people that are self-managing, the potential business, are not looking for a property manager. It's really rare that somebody has a property manager that they're looking actively for a new one unless they've really done a bad job or stolen money or done something really obvious. The people that need your services are not looking for you. You need to be looking for them. And so this is where you can skip all of the cold lead marketing. You don't need to spend money on SEO or AI SEO or Google Ads or pay-per-click or any of these marketing agencies, you don't need to spend any money and you can actually grow faster if you use our strategies and it costs you nothing to do the strategies that we give you. It costs time and action, but it actually takes less time because warm leads and focusing on more effective strategies give you a much greater result in less time. So less time, less money, more results. And that's why we call it the Leadsmith. A lot of people think I just need leads. Cool. there's better ways. Not all leads are equal and we can help you out. Cool. Anything else we should add in wrapping up? I don't think so. I think we covered everything. Okay. I think we got it. So cool. Well, if you are wanting to figure out how do I grow this business? How do I finally get out of the rut that I've been in? How do I scale this? Maybe adding more doors is creating you grief and pain and you want freedom from your business. These are the things we help clients with. We'll help you figure out how to grow dramatically faster and we'll help you figure out how to make your business scalable while getting you out of the day to day and getting you to exit the business in various ways so that you get more freedom. So if you felt stuck or stagnant, you want to take it to the next level, reach out to us at doorgrow.com. Also join our free Facebook community just for property management business owners at doorgrowclub.com if you would like to get the best ideas in property management, join our newsletter at where? doorgrow.com/subscribe And if you found this even a little bit helpful, don't forget to subscribe and leave us a review. We'd really appreciate it. And until next time, remember the slowest path to growth is to do it alone. So let's grow together. Bye everyone.

DGS 314: Deduct Yourself Before you Wreck Yourself - Cost Segregation for Property Managers

What if you could take out a loan with 0% interest and invest that money for as long as you own your investment property? This is something that cost segregation can help real estate investors do. In this episode of the #DoorGrowShow, property management growth expert Jason Hull sits down with Daniel Boyd from CSSI Services to talk about cost segregation, one of the most powerful ways to uncover hidden tax savings for property owners and managers. You'll Learn [03:10] How Cost Segregation Works [08:54] Recent Changes to Depreciation Rules [11:59] Why Real Estate Investors Should Care About Cost Segregation [18:33] The Importance of Working with Tax Experts Quotables "The big idea here is there's things in the property that wear out fast and there's things that that wear out slow." "We love deductions because we want to pay as little tax as possible." "Wouldn't it be great to take a $100,000 loan with 0 % interest, invest it for as long as you own the property?" Resources DoorGrow and Scale Mastermind [https://www.doorgrowacademy.com/courses/mastermind] DoorGrow Academy [https://www.doorgrowacademy.com/] DoorGrow on YouTube [https://www.youtube.com/channel/UCC1mGYT2Sw0LOe32hO_QdNg/featured] DoorGrowClub [https://doorgrow.com/] DoorGrowLive [https://doorgrowlive.com/] Transcript Dan Boyd (00:00) Wouldn't it be great to take a $100,000 loan with 0 % interest, invest it for as long as you own the property? And then when you sell the property, you give the loan amount back and you keep whatever you made on that investment. Jason Hull (00:06) I'm Jason Hull, CEO and founder of DoorGrow, the world's leading and most comprehensive coaching and consulting firm for long-term residential property management entrepreneurs. We have been helping people for over a decade and a half. At DoorGrow, our mission statement is to transform property management business owners and their businesses. We want to transform the industry, eliminate the BS, build awareness, change perception, expand the market, and help the best property management entrepreneurs win. Now, let's get into the show. My guest today is Dan Boyd. We're going to talk about cost segregation, one of the most powerful ways to uncover hidden tax savings for property owners and managers. you'll learn how to accelerate depreciation, apply repair regulations, and know when expenses can be written off immediately. These strategies can help you improve client cashflow, strengthen relationships, and stand out in the market. All right, Dan, welcome to the DoorGrow Show. Thanks so much for being here with you. So Dan, before we get into cost segregation, which is an interesting subject, that's... Dan Boyd (01:10) Thanks so much. Great to be here with you. Jason Hull (01:19) They had some changes recently, right? There's been some changes in depreciation thanks to Mr. Trump and all this stuff going on, right? The president, I think. So I'm curious what you have to say about that. But tell us, how did you get connected to this business? Give us some backstory on Dan. Dan Boyd (01:36) Sure, yeah, it's a little funny. I meet, you bet, I meet people from time to time and they say, how on earth did you get into this line of work? Because it's not like anybody goes to school to work in cost segregation or at least cost segregation sales. know, tale as old as time, I knew somebody. And so I was working in the nonprofit sector. My goal was to become a superintendent. So I had gotten a doctorate in education and I was headed in the right direction. But I found out that the average superintendent lasts for about two years. Dan Boyd (02:05) and then they get run out of town for one reason or the other. And it's typically a very stressful two years. And so while it's a rewarding ⁓ position and the compensation is usually pretty good, I thought, why don't I just skip those two years and go into sales and consulting? And so somebody had told me, I think you'd be pretty good at this. And so I started selling cost segregation for our company. And then, There was an opportunity, they said, you know what, we needed to improve our training and our education, and you've got the perfect background. You understand what we do, but you also come from a world of education, so why don't you join us in that capacity? And so it's been a very good fit since then. Jason Hull (02:28) Got it. So you didn't wake up as like a kid in elementary school saying you wanted to do cost segregation. Dan Boyd (02:48) Believe it or not, no, I can't even say it was on the radar, right? There was like baseball player and then commando and maybe basketball player and football player. So like cost segregation wasn't anywhere near the top of that list. Jason Hull (02:53) Property management business coach was not on my radar back then either, so I get it. All right, cool. So let's get into the topic. So cost segregation, how do we uncover some hidden tax savings? Dan Boyd (03:14) So the big idea here is there's things in a property that wear out fast and there's things in a property that wear out slow. But how do you know? And that's where we come in. So our job is to tell you with our knowledge of the IRS code and buildings, that's what makes us unique. We're very good at both of those things. ⁓ What's the value of everything in your property that wears out quickly? Once you know that, you get to write it off quickly. So let's say you buy an apartment building for a million dollars, Ordinarily, you're going to depreciate that whole building over 27 and a half years. Well, there's components in that property that are going to last three years, five years, seven years. So shouldn't you be able to write it off sooner? The answer is yes. And that was actually there's a landmark court case that led to this. And that was the big argument is, hey, we replace some of these components every five years. You're making us wait 39 years because it's a commercial property to depreciate it. And the court ruled in their favor and said, you're right. And so our job is to come in and really give somebody a huge deduction in the first year. Sometimes 25, 30, 40 % of the building value can be deducted as quickly as the first year. Jason Hull (04:28) Okay, got it. That's significant. Okay. And we love deductions because we want to pay as little tax as possible. Absolutely. Yeah. Yeah. Yeah. I love asking business owners. I say, what's the biggest expense in your business? Dan Boyd (04:34) We do. Absolutely. Yeah. If I have yet to meet somebody who's happy with the amount they have to pay and wouldn't reduce it if they had the chance. Jason Hull (04:49) And then they usually say payroll or staffing. And I say, no taxes, but then payroll. Yeah. they forget about it they don't think of it. It's like grabbing, right? Like you just assume it's there and you have to obey the laws. OK, you just move past it. It's like, well, my biggest expense is payroll because people are expensive. Well, yes, that's true. But if there's if you have deductions, right, if it's part of the tax code, you can legitimately I joke. Dan Boyd (04:55) Yep. And they forget about it because they don't think of it. It's like gravity, right? Like you just assume it's there and you have to obey the laws. And so you just move past it. Right. It's like, well, my biggest expense is payroll because people are expensive. Well, yes, that's true. But if there's if you have deductions, right, if it's part of the tax code, you can legitimately I joke like anybody cannot pay taxes. We help people not owe taxes. Jason Hull (05:17) Okay, yeah. So I was flying actually this weekend with my wife for the first time because she's working on her pilot's license. she wanted me to be in the plane with her and wanted me to experience flying with her. And so she doesn't have her license yet. So I got to sit in the back and she had her instructor next to her and they're flying. And her instructor, I was like this, you know, I was making jokes about how flying isn't. You know, it's pretty relaxing, pretty calm most of the time. And he said, well, I said, I thought it would feel like a roller coaster. He's like, do you want it to feel like a roller coaster? I'm like, sure. And so he does some fancy eight maneuvers or whatever. But what was interesting is when gravity disappeared, when I did not feel gravity anymore, I was like, I'm missing something that I'm so used to. I don't even know that it's there, but you notice it when it's gone quite a bit. Right? It was very noticeable to not have gravity and just be kind of sitting above my seat a little bit as we kind of dropped. And I was like, okay. So yeah, so taxes can be a little bit like gravity, I guess. Constant pressure. Dan Boyd (06:26) Yeah, and if all of sudden, you you were, yeah, if you were used to paying $100,000 in taxes and then all of sudden you didn't have to, you would notice that. That'd be a big deal. Jason Hull (06:33) Yeah, absolutely. Yeah, that would be great. All right. So what are the steps to making that happen? Dan Boyd (06:42) So first thing is, ⁓ assuming that this makes sense, you've got to owe taxes and you need to hold your building for at least a couple of years. And I can get into why. But ⁓ if you wanted to see, does this make sense for me, just get an estimate. So find a reputable firm to work with that does engineering-based cost segregation. And they'll send you an estimate. And they'll say, hey, we think you're going to get somewhere between these two numbers. And that's a high and a low end. And so in general, that's 25 % of what we call the building value. So subtract land out, right? Now you're just left with the building on that lot. That's what you get to depreciate. So if you've got an $800,000 building, maybe you paid a million, land is worth $200,000, subtract that out. So you got $800,000. And again, you'll get a range saying maybe you'll get somewhere between $180,000 up to $300,000 in depreciation. If you like the way that looks, the fee makes sense, and you owe taxes, and you can use it this year, then you proceed with that cost segregation study. And usually, I would say with our firm within two to four weeks, we give somebody a report. So we make it very simple. That report justifies the big deduction. So if somebody ever got audited, which is a pretty rare occurrence anyway, they would be able to explain, here's why we did this. This is legitimate. We worked with a firm that has real engineers that did this. And it gives the CPA what they need. know, CPA is not just going to say, okay, yeah, I'm going to give you a $200,000 deduction for fun. They have to feel comfortable because their signature is going on it. So it's our report that demonstrates to the CPA and to the IRS, this is a legitimate deduction within the tax code and this will stand up to an audit. Jason Hull (08:25) Cool, because we got to make sure that IRS is okay with this. I don't really care if the IRS is happy, but I don't want to be on their bad side either. I just want them to leave me alone. That's really, I think, the goal, right? Got it. Okay. So your company helps with this, right? CSSI. Yes. Okay, got it. Dan Boyd (08:28) Absolutely. If they're not happy, nobody's happy. Yeah, yeah, absolutely. Yeah, as long as they're well, I just want them to be happy with you. We're not unhappy with you. Yes. Jason Hull (08:53) Okay, so, are there different rules? I had mentioned at the beginning, maybe, I don't know, but I thought some rules that kind of change with depreciation and how it works, just recently. Dan Boyd (09:05) They did. Yeah. So in ⁓ this most recent one big beautiful bill, there was a change that brought back what's called 100 percent bonus depreciation. So what does that mean? There's some misunderstandings and sometimes people assume that means you can deduct 100 percent of the building value. That's not the case. So I said there's stuff in a property that wears out fast and there's stuff that wears out slow. So the IRS has categories for that that they call useful lives. So there's a probably the most common categories that ⁓ Property managers are gonna need to be aware of are the five-year useful life and that's roughly the stuff inside the units and then there's the 15-year useful life That's the site improvement. So that's a parking lot. That's landscaping that signage. That's a fence. That's a pool Those kind of things the things on the common ground, right? so what that means is if something has a five-year useful life, you depreciate it over five years. So automatically, that's faster than 27 and a half. So that's accelerated depreciation, because we accelerated it from 27 and a half years to five years, and from 27 and a half to 15 years. Bonus depreciation lights a fire underneath those two categories. And so rather than waiting five years or 15 years, you get some percent of that value right now. So if we're in 100 % bonus year, it means you get 100 % of the five-year value and 100 % of the 15-year value right away. And so ⁓ if we just say, you know what, cabinets, countertops, crown molding, that kind of thing, swimming pools, parking lots, that's all gonna be accelerated. So if you had $500,000 in those two categories, rather than waiting five years or 15 years to get that money, you bonus depreciate it and get all of it this year. ⁓ We just came out of what's called a sun setting bonus period. so from 2022 to 20, I'm sorry, from 2017 to 2022, people got 100 % bonus depreciation. So if your property was placed in service as a rental in those years, it gets 100 % bonus period. Doesn't matter when you do the cost segregation. But in 2023, it started to go down 20%. So 2023 was an 80 % bonus year. 2024 was a 60 % bonus year. And the first 19 days of 2025 are a 40 % bonus year. So 100 % bonus depreciation kicks in on inauguration day. So they made it retroactive to the inauguration day. So if you bought Dan Boyd (11:27) 2023 was an 80 % bonus year, 2024 was a 60 % bonus year, and the first 19 days of 2025 are a 40 % bonus year. So 100 % bonus depreciation kicks in on Inauguration Day. So they made it retroactive to the Inauguration Day. So if you bought a property and placed it in service on January 20th or later, you get 100 % bonus depreciation. Jason Hull (11:54) Cool. Okay. Right. So thank you, Donald. All right. So why should investors that are wanting to invest more care about cost segregation? Why should they be paying attention to this? Because I think this plays into their strategy, but some may not get it. Dan Boyd (11:56) Yeah. Great question. So the time value of money, if I could give you $100 today or $1 a day for the next 100 years, it's worth way more to you to get that money today because you can invest it, right? There's no inflation, yada, yada, yada. So the more tax deductions or reductions you can get early on, the more you're able to free up your capital and deploy it to grow your portfolio, right? to repair your property, to increase rent, to pay down debt. And that money is worth a lot more to you today. So if you can get 25 % of your building value back now, rather than in a quarter century, why wouldn't you do that? Jason Hull (12:56) Got it, okay. Let's do a quick word from our sponsor, Cover Pest. And then we'll continue. Cover Pest is the easy and seamless way to add on demand pest control to your resident benefits package for your property management company. Residents love the simplicity of submitting a service request and how affordable it is compared to traditional pest control options. Investors love knowing that their property is kept pest free and property managers love getting their time back and making more revenue per door. Simply put, Cover Pest is the easiest way to handle pest control issues at all your properties to learn more and to get special DoorGrow pricing, visit coverpest.com/doorgrow All right, cool. Check out Cover Pest. All right, so back to this idea of investors leveraging cost segregation. So this is going to allow them basically more money now means you can take that money, deploy it in more effective ways now to grow it so you can have more of it later, right? Is kind of the idea. Dan Boyd (13:59) Yeah, absolutely. ⁓ If you owe taxes right now and you own rental property, as long as you're going to hold that property for even just two or three years, you are going to make more money by taking more depreciation, reducing your tax burden, freeing up capital to reinvest and make some rate of return. And so as long as you can invest that money and earn a return, then you're going to benefit from doing this. Jason Hull (14:06) Yeah, same reason I file an extension every year. I wanna delay the IRS having access to any of the funds so that I can do more stuff with it before they get their hands on it, right? So more money faster and... Dan Boyd (14:38) There you go. Jason Hull (14:42) IRS later. Yeah, that's the ideal goal. Cool. So how do they make sure that they're making good decisions around all of this? This is where a company like CSSI comes in, I would imagine. Dan Boyd (14:54) Yes, so we see ourselves as consultants. so in fact, just probably an hour ago, I was on the phone with somebody who couldn't benefit from a cost segregation. And it was really because he didn't owe enough in taxes. And I said, you just don't need this deduction right now because you don't owe anything. And so you'll be paying for the service to get a huge deduction. And that's great. But it only makes sense to have a big deduction if you have a lot of income. And so our job is to look at somebody's scenario and say, here's what we think your deduction will be, let's match that up with what's your tax liability? Do you owe a lot this year? Or maybe are you going to owe next year? Should you wait? And then how long are you going to own this property? Let's do the math and figure out, does this investment make sense? And so that's kind of the big one. My two litmus tests are, do you owe taxes? And are you going to own this property long enough to invest this? And the reason for that is when you take depreciation on a property, That's kind of the big one. My two litmus tests are, you owe taxes? And are you going to own this property long enough to invest this? And the reason for that is when you take depreciation on a property, whatever you take out, you owe back when you sell the property. That's called recapture. And so oftentimes people are afraid of that. But I think the best way to think of that is like a loan, right? The IRS loans you that depreciation. And then when you sell the property, you owe the depreciation back. But they don't charge you interest on that. And so Wouldn't it be great to take a $100,000 loan with 0 % interest, invest it for as long as you own the property? And then when you sell the property, you give the loan amount back and you keep whatever you made on that investment. Jason Hull (16:15) Okay, so how long is long enough to own the property then? Dan Boyd (16:25) It depends on your rate of return. And so if I give somebody, let's say, $100,000, and they can make 7.5%, as long as they pay less than $7,500 to get the cost segregation study, they're going to make money. And so that's usually how I do that math. And it's different for everybody. And sometimes they're not sure. And so I'll kind of walk them through. my tendency is to be a little cautious with it and say, if you're not sure, I don't want you to get into a situation where you're going end up owing more than you got in terms of your reduction in taxes and any benefit out of this. But I'd say a very comfortable break-even period is three years. Jason Hull (17:07) Okay, got it. Okay, so if they own it for at least three years, then it may make sense. They should probably be considering it. Especially if they owe taxes and they haven't figured out how to zero those out. Dan Boyd (17:12) Yeah, absolutely. And if they plan to. Yeah, exactly. Because once you pay taxes, money's gone forever. You can't get it back. No, not at all. And if you, you know, if people are worried like, I don't want the depreciation, I don't want the depreciation recapture in the future. It's like, okay, well really what you're saying is you'd rather have that money in three years when you sell the property than have it now. And if that's true, that's fine. But then you're missing out three years of the time value of money of money. Right. And if you're a decent investor, you could probably do something with that money, like grow it over the next three years. Dan Boyd (17:55) Yeah, absolutely. In that example I used, you know, getting $100,000 in tax savings back for 7,500, it may cost less than 7,500. Jason Hull (18:05) So it could be a no-brainer, but you'll help them see that, which makes it probably a very easy product to sell to the right person. Dan Boyd (18:08) Yeah, I try not to make it too complicated. We are in the tax world, right? It's tax and real estate, so it's kind of funky. But I just try to keep it high level and let people know, hey, here's what you're to deduct. So in other words, here's how much income you won't owe taxes on. And mathematically, does that make sense for you? And if so, let's talk about the next steps. Jason Hull (18:33) So what are the other big questions that people ask you when you are selling these services? Dan Boyd (18:40) Great question. So the big one is, I going to get in trouble with the IRS? The answer there is no. So this is no more risky than even just, let's say, cost segregation. So our company's done in the ballpark of 55,000 studies. And we have not seen that this triggers an audit. And when the IRS asks to take a second look, they're usually just as part of due diligence. And so they don't reject the results. They don't have penalties or anything like that. They're usually just, you that's part of due diligence. And so they don't reject the results. They don't have penalties or anything like that. So it's pretty rare that somebody would even get an audit when they have a cost segregation done. The other, I would say like a typical safety concern, right? Is people say, well, that's my CPA's job, right? They do that. a CPA, kind of depending on who your CPA is and how they operate. You might say it's not really their job to look for business strategies for you, right? Ways that you can deploy capital and invest it. Dan Boyd (19:39) They're preparing your taxes, right? That's really what they're allowed to do. So I think people often make that mistake of thinking that their CPA is their business coach. And plain and simple, they are not, unless you're paying them a lot of money to do that. And so we work with a lot of CPAs who do that type of consulting and work, and they refer their clients to us, because this is not something a CPA can do, because you've got to have an engineering background. And so unless your CPA went to school first to be an engineer and then a CPA. This is not in their wheelhouse. if their firm offers it, they're probably just working with a firm like ours and saying, OK, we'll pay for the study, and then we'll give it or sell it to our client. Jason Hull (20:29) They are not trying to do anything related to lowering your tax dollars. yeah. so we've been, and I have been able to wipe out our taxes just by getting really good tax advice, but it's never from our CPA or from our accountant. Yeah. So I would recommend anybody listening get. Dan Boyd (20:47) Yeah, as you would expect it to be. Jason Hull (20:50) If you have a CPA, awesome. And I highly recommend you go, if you're a business owner, get a profit first certified professional. I think that's a good early stage step to making sure you have financial health in your business. They're going to take things a little bit beyond just standard accounting, but go find a tax expert that's going to help you with tax stuff. And then you're going to need probably experts like CSSI. We used a special company that assessed our own property so we could rent it to ourselves using the Augustus rule and stuff like this. So there's niche companies that you can use that will help find more money for you. Dan Boyd (21:29) It's, know, in ⁓ any line of work, there's specialties. And so, you know, in medicine, there's specialists, right? You've got your general practitioner, and they see you for normal things, right? You go there when you have a cold or for an annual checkup. But when something serious is going on, you always go to a specialist. And taxes are the same way. And so I'd say, you somebody's CPA is like their family doctor, and they should see that family doctor on a regular basis. But we're the specialists. I would say we're probably most like a radiologist, right? Because we see things that other people don't see in terms of tax savings. And so that's our role. We don't prepare taxes. We prepare reports that help people not owe a lot of taxes. Jason Hull (22:10) Right. And there's a lot of different specialists out there and we've leveraged several financially and I'm sure there's more we're not even aware of that, you know, as Sarah and I grow and learn in our financial health, you know, that we will utilize. these are these are things that I would love everybody listening to be aware of. So I'm glad to have you here today. So did we miss anything that you think would be important for the audience to know about cost segregation? So, Dan Boyd (22:36) So, you know, why would like to your audience, why does this matter? And I'd say, if your clients don't hear about it from you, they're going to wonder why they're going to think my like, I trust this person with real estate, I would have expected them to know about this. And so Jason Hull (22:39) Yeah. Ooh, yeah. them to know about this. Yeah, they are expecting you to be the investment specialist. That's where you set yourself head and shoulders above just being a property manager where you're like, you know, a commoditized service. Then you're at that next rung on the ladder where you're an advisor, you're a consultant, they appreciate you. so, yeah, property managers could be leveraging CSSI. How can they leverage you guys? So a really easy way to get in touch with us is Dan Boyd (22:56) Yes. Yep. So a really easy way to get in touch with us is you can just go to our website and there's a calculator there. And I think actually this is what would be even better. I think we have a landing page, especially for DoorGrow listeners. So people can go there and you can get information about a property. if you want information for a client, you could go there and you could submit a request and we will send you an estimate for that client, that property. With a discount for DoorGrow listeners. so, ⁓ yeah, there we go. So that's cssiservices.com slash DoorGrow. And ⁓ that's probably the best way, right? There's some basic information you can put in about the property and that will go to me and to one of our other reps, George Taylor. And we'll make sure to walk you through it, help you understand how you can talk to your clients about this so that you come across as the expert, right? We wanna, we don't need to take center stage. We wanna help you. And we'll make sure to walk you through it, help you understand how you can talk to your clients about this so that you come across as the expert, right? We don't need to take center stage. We want to help you be the be the expert and really deliver the great news to your clients. And again, if they hear this from you, they're going to say, that's why I work with this person. I work with them because they're looking out for me. They have my best interest in mind. And if they don't hear from you, then they'll say, wow, I wonder why, you know, why didn't they know about this? Or if they did know about it, why didn't they tell me? Jason Hull (24:33) Yeah, they're expecting you to be the investment specialist and it's a painful realization for them when they get advice outside on their property. That's a good idea and you didn't give it to them. So you want to be the one that delivers this good news. So ⁓ yeah, so that website address is C as in Charlie, S-S-I-S-E-R-V-I-C-E-S. So CSSI services dot com slash DoorGrow. Dan Boyd (24:48) Absolutely. Dan Boyd (25:08) And is that DoorGrow just ⁓ all one word? OK, gotcha. Yeah. So and I'd say, you know, doesn't there's no cost to getting the estimate to determine, hey, how much is how much could this save somebody in taxes? And so really no harm to getting that estimate and presenting it to somebody. And that way, even if they don't need it this year, they have that for decision making purposes in the future. That's part of tax planning to say, OK, this year, my taxes are taken care of. But next year might be a really big tax. Jason Hull (25:18) Yes. Got it. And so the property manager could initiate this process for each of their properties. They could. Okay, got it. Very cool. Well, Dan, I appreciate you coming on the show. Glad we have this cool DoorGrow page. That was a nice surprise set up. Jason Hull (25:58) Anything else you want to Dan Boyd (26:00) I don't think so, other than I hope we can help all of your audience save their clients tens and hundreds of thousands of dollars in taxes this year, next year and beyond so that they've got more money to buy more properties and just continue to grow their portfolios. Jason Hull (26:14) Yeah, that would be some nice surprises. I don't think anybody's clients would complain about that. So, all right. Appreciate you being here on the DoorGrow show, Dan. All right. So if you've ever felt stuck or stagnant in your property management business and you want to take it to the next level, reach out to us at DoorGrow dot com. Also join our free Facebook community. It is just for property management business owners at DoorGrow club dot com. And if you would like to get the best ideas in property management, join our newsletter. Dan Boyd (26:19) I don't think so. You bet. Thank you, Jason. Jason Hull (26:43) by going to doorgrow.com slash subscribe. And if you found this episode even a little bit helpful, don't forget to subscribe and leave us a review or a positive comment on whatever channel that you saw or heard this on, we'd really appreciate it. And until next time, remember the slowest path to growth is to do it alone. So let's grow together. Bye everyone.

DGS 313: Profits Hidden in Plain Sight with Brian Seidensticker

As a property manager, how much do you know about tax liens and tax deeds? How much do your investors know? In this episode of the #DoorGrowShow, property management growth expert Jason Hull sits down with Brian Seidensticker, Founder of Tax Sale Resources and Mountain North Capital, to discuss how property managers can help their investors buy more properties using tax lien strategies. You'll Learn [01:40] From Aerospace Engineering to Buying Tax Liens [06:46] How Property Managers Can Benefit [16:06] How to Learn The Ins and Outs of Tax Lien Investing [23:29] The Biggest Questions and Pitfalls Quotables "Property managers, the savviest ones, they're building up their own portfolios, not just helping everybody else." "Property managers… what gets them access to more deals is just being connected to more investors." "This might crack open a new idea for them, another growth channel that they could leverage as a resource for their investors." Resources DoorGrow and Scale Mastermind [https://www.doorgrowacademy.com/courses/mastermind] DoorGrow Academy [https://www.doorgrowacademy.com/] DoorGrow on YouTube [https://www.youtube.com/channel/UCC1mGYT2Sw0LOe32hO_QdNg/featured] DoorGrowClub [https://doorgrow.com/] DoorGrowLive [https://doorgrowlive.com/] Transcript Jason Hull (00:00) This might crack open a new idea for them, another growth channel that they could leverage as a resource for their investors. All right, I'm Jason Hull, the CEO and founder of DoorGrow, the world's leading and most comprehensive coaching and consulting firm for long-term residential property management entrepreneurs. For over a decade and a half, we have brought innovative strategies and optimization to the property management industry. At DoorGrow, we have spoken to thousands of property management business owners, improving pricing, increasing profits, simplifying operations. We run the world's leading property management mastermind to help them grow. DoorGrow, we believe good property managers can change the world and that property management is the ultimate high trust gateway to real estate deals, relationships, and residual income. We are on a mission to transform property management business owners and their businesses. We want to transform the industry, eliminate the BS, build awareness, change perception, expand the market. and help the best property management entrepreneurs win. Now, let's get into the show. So my guest today is Brian Seidensticker, founder of Mount North Capital and Tax Sale Resources, one of the nation's top platforms tracking over 8,000 tax sales and over 1.5 million distressed properties each year. Brian is a leading expert in tax lien and deed investing and shares how property managers can turn overlooked tax delinquent properties into major portfolio growth opportunities. Brian, welcome to the show. Thanks Jason, thanks for having me. Excited to be here. Cool. So before we get into the topic at hand, let's rewind and tell everybody how did you get into entrepreneurism and how did you get into these businesses that you now have? Brian Seidensticker (01:37) Thanks Jason, thanks for having me. Excited to be here. Yeah, well, I think it's an interesting story, although I'm slightly biased because I did not grow up with aspirations of being in this space or doing what I do today, although I love what I do now. I think the probably the first sign of, maybe the standard corporate. Jason Hull (01:55) I think it's an interesting story. sign of hey maybe the standard corporate Brian Seidensticker (02:14) atmosphere isn't necessarily for me came when I was ⁓ still in school. Got my first internship in the aerospace industry, which is where I spent the first 10 years of my career ⁓ at Honeywell, of all places, in design engineering and ⁓ thought it was exactly what I wanted to do, but I didn't know much about, you know, engineering and what was actually involved. ⁓ Jason Hull (02:14) atmosphere isn't necessary for me came when I was still in school got my first internship in the aerospace industry which is where I spent first 10 years of my career at Honeywell of all places and design engineering and thought it was exactly what I wanted to do but I didn't know much about you know engineering and what was actually all Brian Seidensticker (02:40) And that is the first time that I kind of realized, okay, maybe maybe this is not what I had in mind. was, you know, it's odd, you know, ironically enough, not a whole lot different than what I do today. I stared at a computer all day and that is not what I had envisioned for engineering. was assuming it was going to be much more hands on and touching things. And that was probably the first time where I called it my earliest twenties crisis, where I was like, Oh, you know, I'm three, four years into this. Is this what I want to do for the rest of my life? Jason Hull (02:40) And that is the first time that I kind of realized, okay, maybe this is not what I had in mind. was, ironically enough, not a whole lot different than what I do today. I stared at a computer all day and that is not what I had envisioned for engineering. was assuming to be much more hands-on and touching things. That was probably the first time where I call it my earliest 20s crisis, where I was like, whoa, I'm three, four years into this. Is this what I want to do for the rest of my life? Brian Seidensticker (03:10) and ultimately decided, well, I'm this far along. Starting over was more terrifying. so, you know, go ahead and finish it out. I was I was lucky in the fact that ⁓ within a year out of school, I did land what I consider a dream job and did love what I did for for quite a while. ⁓ I was basically what they call systems engineer for missile defense programs, working on Jason Hull (03:10) And ultimately decided, well, I'm this far along. Starting over was more terrifying. And so, you know, go ahead and finish it out. I was, I was lucky in the fact that within a year out of school, I did land what I consider a dream job and did love what I did for quite a while. I was basically what we call systems engineer for Missed Defense Programs, working on, you Brian Seidensticker (03:39) you know, programs that essentially mimic ⁓ weapons of other countries. And then our systems would also practice shooting them down, which all sounds really, really cool. Right. And it was cool. ⁓ But my my second realization came later when I kind of well, I went on vacation for six weeks and I had a lot of anxiety about being gone that long of how much I would be behind. And when I got back, I realized, you know, how Jason Hull (03:40) programs that essentially mimic weapons of other countries and then our systems would also practice shooting them down, which all sounds really, cool. Right. was cool. But my second realization came later when I kind of, well, I went on vacation for six weeks and I had a lot of anxiety about being gone that long and how much I would be behind and when I got back I realized how Brian Seidensticker (04:08) little I was behind. Jason Hull (04:08) little I was behind. Brian Seidensticker (04:10) was basically stepped right back into it like I'd never been gone. And that was a realization for me that, you know, I'm spending a lot of my time on a hamster wheel unknowingly. And then eventually came to the conclusion that I've got two years of banging my head against the wall with government contracts, right? Anybody has dealt with that red tape associated with that for what equated to about two minutes of really cool. that those those just didn't equate for me as being worth it. Jason Hull (04:10) and Yeah. ⁓ Brian Seidensticker (04:37) Right. And that's not to say, you know, I loved what I did at certain cases that company I worked for was fantastic. It just wasn't necessarily for me. And that was where I kind of realized, OK, I got to find something else. Now, I wish I could say the next day I gave my notice, dropped the mic and left. That's certainly not how real life works. ⁓ But I did start getting into, well, originally fix and flip houses. Jason Hull (04:49) and and Brian Seidensticker (05:01) And this is in 06, 07 timeframe and ended up upside down in one of those. were flipping properties in Montana. And I guess most people know what happened in 07, 08. Luckily, it wasn't a detrimental thing and I didn't have too many houses, but was upside down. And so I've got a notice of a potential taxing on that property. Now, the odd thing is that Jason Hull (05:06) and ended up upside down in one of those. were flipping properties in Montana and I guess most people know what happened in 07, 08. Luckily it wasn't a detrimental thing and I didn't have too many houses but it was upside down and so I got a notice of a potential taxing on that property. Now the odd thing is that because the way that Montana statutes are at the time, Brian Seidensticker (05:30) because the way that Montana statutes are at the time where every potential investor had to send you a certified letter, I didn't just get one notice from the county. Probably would have never thought twice about it, but I got 20, 30, 40 of these certified letters all saying roughly the same thing. And that's really what triggered me to go, what is this all about? guess I'm a curious person by nature and started researching this whole tax lien certificate. Jason Hull (05:34) where every potential investor had to send you a certified letter. I didn't just get one notice from the county. I would have never thought twice about it. But I got 20, 30, 40 of these certified letters all saying roughly the same thing. And that's really what triggered me to go, what is this all about? Because I'm a curious person by nature. I started researching this whole tax lien certificate enigma at the time. And lo and behold, was a whole industry. Brian Seidensticker (05:59) enigma at the time. And lo and behold, it was it was a whole industry. There's legitimate large businesses and banks that are are doing this. And that's what really steered me in the direction of shifting from a fixed flip to buying tax liens. And that was really the introduction to the space that we do a lot in today. So I guess a little bit on the journey of how I eventually became an entrepreneur ⁓ and how I was introduced to this space. ⁓ Jason Hull (06:04) legitimate large businesses and banks that are doing this. And that's what really steered me in the direction of shifting from a pay-per-fit to buying tax leaps. And that was really the introduction to this space that we do a lot in today. So was, I guess, a little bit on the journey of how I eventually became an entrepreneur and how I was introduced to this space. Brian Seidensticker (06:28) I guess there's a whole line between today and then, but that's kind of the origin story anyway, Jason. Jason Hull (06:28) I guess there's a whole lot in between today and then, but that's kind of the origin story. Got it, yeah, interesting background. So from aerospace, doing engineering, to real estate fix and flips, and now you're in software and technology and doing some other cool stuff. So tell us a little bit about how can this benefit property managers? Let's get into this idea. Yeah, so. Brian Seidensticker (06:57) Yeah. So I think when it comes to property managers specifically, whether they're working with investors, to acquire on behalf of the investor and then they're operating that property or they're maybe managing that portfolio themselves. I really what tax sales have two different avenues, there's tax liens and then there's tax deeds. The tax deeds are what are sold at the end of a ⁓ foreclosure process for the Jason Hull (07:16) Deeds are what are sold at the end of a proposal process for the liens that never end up getting repaid. They go through a proposal process very similar to the mortgage proposal closure, although a lot longer timeline. And most of those are in areas where property managers or let's say a segment of property managers, you can get great. ⁓ Brian Seidensticker (07:23) liens that never end up getting repaid. go through a foreclosure process very similar to a mortgage foreclosure, although a lot longer timeline. ⁓ And most of those are in areas where property managers or I'd say a segment of property managers, ⁓ you can get great, ⁓ the great Jason Hull (07:43) great rental options, especially if you're in the avenue of fixing rent. We work with several folks that buy properties, fix them up Brian Seidensticker (07:43) rental options, especially if you're in the avenue of fixing rent. We work with several folks that buy properties, ⁓ fix them up and with intent to rent them. And so if you're looking for an avenue of acquiring properties, right, and it may shift here in the next couple of years, we'll see what comes to reality. ⁓ But it's been an avenue of acquiring properties for the past 10 years where I think most people found it to be Jason Hull (07:53) with intent to rent them. And so if you're looking for an avenue of acquiring properties, it may shift here in the next couple of years, and we'll see what comes to reality. But it's been an avenue of acquiring properties for the past 10 years where I think most people found it to be pretty... Brian Seidensticker (08:12) pretty hard to find any sort of consistent ⁓ deals at a smaller scale of acquiring to build that portfolio over time. That's really probably the biggest impact too. Jason Hull (08:12) pretty hard to find any sort of deals at a smaller scale requiring to build that footloid over time. That's really probably the biggest impact to those folks. Now on the flip side, as a data point, one of the quickest ways of getting in trouble, right, is if properties that are owned outright, and we see this all the time, that are owned outright, you don't have that, you know, tacking of... Brian Seidensticker (08:23) to those folks. Now, on the flip side, as a data point, I think one of the quickest ways of getting ⁓ in trouble, is if properties that are owned outright, and we see this all the time, that are owned outright, you don't have that ⁓ escrow Jason Hull (08:41) best grow account that's making sure those taxes get paid and that people aren't paying those on their own behalf and they can end up in a tax outproposure unknowingly. Now, most people catch on, but we have Brian Seidensticker (08:41) account that's making sure those taxes get paid. And if people aren't paying those on their own behalf, then they can end up in a tax out foreclosure unknowingly. Now, most people catch them, but we have seen Jason Hull (08:51) seen properties that make it all the way through and at the end of the day, end up essentially losing a property due to these unpaid taxes and ignoring notices over a couple years. It seems like impossible, but it happens, right? And so it's making sure that property managers and just investors in general understand. Brian Seidensticker (08:51) properties that make it all the way through. at the end of the day, end up essentially losing a property due to these unpaid taxes and ignoring notices over a couple of years, which seems like impossible, but it happens. And so it's making sure that property managers and just investors in general understand, hey, Jason Hull (09:09) Hey, gotta keep monitoring, keep paying those property taxes even after the escrow is done and you have the property paid Brian Seidensticker (09:09) you got to keep monitoring and keep paying those property taxes even after the escrow is done and you have the property paid off. Jason Hull (09:15) off. Yeah, a lot of people get confused during the sale process and think, oh, it's all taken care of. Yeah, well for so many of us it is, right? If you have a mortgage on your house, it's all taken care of, right? It's when that mortgage is paid off, it's a happy day, but now you've got a few more things you've got to monitor you've never had to worry before. Yeah, got it. So, Brian Seidensticker (09:22) Yeah, well for so many of us it is, right? If you have a mortgage on your house, it's all taken care of, right? It's when that mortgage gets paid off, it's a happy day, but now you've got a few more things you've got to monitor you've never had to worry before. Jason Hull (09:37) Yeah, property managers, the savviest ones, they're building up their own portfolios, not just helping everybody else. And so they're investors too. And so this could be a nice channel or avenue for them to find some additional deals or properties. So what do they need to know in order to get started with working with tax liens or tax deeds and finding property? Well, I think the biggest thing to understand is really how the sales are. Brian Seidensticker (10:02) Well, I think the biggest thing to understand is really how the sales occur in your area. Every state has a slightly different process, slightly different statutes, ⁓ and even within that state, counties can interpret those statutes slightly differently. And so the number one thing that I always recommend is be smart and as in talk to an attorney that is familiar with the sale process in your specific area. ⁓ It's an Jason Hull (10:08) state has a slightly different process, slightly different statutes, ⁓ and even within that state counties can interpret those statutes slightly differently. And so the number one thing that I always recommend is be smart and as in talk to an attorney that is familiar with the sale process in your specific area. ⁓ It's an unregulated space, meaning you don't have to have a license. There's nothing you have to do to participate. Brian Seidensticker (10:30) unregulated space, meaning you don't have to have a license. There's nothing you have to do to participate. If you have got Jason Hull (10:37) you've got capital, can go jump on one of the auction platforms and start buying. But that's also a quick way of maybe getting into a property you shouldn't have. you had spoken to an attorney that knows what they're doing, they might have advised you on submitting those pit holes to a lawyer. So that would be mine and one recommendation is start there. Now, if you're not quite ready, Brian Seidensticker (10:37) capital, you can go jump on one of the auction platforms and start buying. But that's also a quick way of maybe getting into a property you shouldn't have. And if you had spoken to an attorney that knows what they're doing, they might have advised you on many of those pit holes to avoid. And so that would be my number one recommendation ⁓ is start there. Now, if you're not quite ready, I think the next best thing, in my opinion, is we do, I do interview ⁓ Jason Hull (11:00) think the next best thing in my opinion is we do, I do interview. Brian Seidensticker (11:03) attorneys in different states. And so if you don't want to pay the attorney fees to figure some of that out, ⁓ it's free on our site. You don't have to pay anything. Just go to our website and there's a resources section you can filter down by the state that you're interested in. And if I've interviewed an attorney and asked a lot of those questions, it can be a free hour or two of that attorney's time ⁓ answering those basic questions for anybody that wants to start there. Jason Hull (11:04) attorneys in different states and so if you don't want to pay the attorney fees to figure some of that out it's free on our site you don't have to pay anything just go to our website resources section you can filter down by the state that you're interested in and if I've interviewed an attorney and asked a lot of those questions it can be a free hour or two of that attorney's time answering those basic questions for anybody that wants to start there Brian Seidensticker (11:28) It's a less expensive starting point. Jason Hull (11:29) it's a less expensive starting point Okay great, what's the website address? We'll plug it right now. taxsaleresources.com awesome. Let me do a quick word from our sponsor and then we'll get back into this. So many of you tell me that maintenance is Brian Seidensticker (11:34) This is taxsaleresources.com Jason Hull (11:51) Probably the least enjoyable part of being a property manager and definitely the most time consuming. But what if you could cut that workload up to 85 %? That's exactly what Vendoroo has achieved. They've leveraged cutting edge AI tech to handle nearly all your maintenance tasks from initiating work orders and troubleshooting to coordinating with vendors and reporting. This AI doesn't just automate. It becomes your ideal employee, learning your preferences and executing tasks flawlessly. never needing a day off and never quitting. This frees you up to focus on the critical tasks that really move the needle for your business, whether that's refining operations, expanding your portfolio, or even just taking a well-deserved break. Over half the room at DoorGrow live last year at our conference signed up with Vendoroo right there and then a year later, they're not just satisfied, they're raving about how Vendoroo has transformed their business. So don't let maintenance drag you down. step up your property management game with Vendoroo. Visit vendoroo.ai slash DoorGrow today and make this your last maintenance hire you'll ever need. Okay, so let's get back into tax liens and tax deeds. Now, how could property managers start to educate their clients on this so that they can get more properties in their portfolio? Brian Seidensticker (13:10) So, one, I guess a quick note, just listening to that note from Vendoroo. ⁓ This is the first I've heard of it and it sounds fantastic. So it's definitely one I'm gonna check out after this. That's cool. So, sorry, I was thinking about that. How does Tax Sale Resources help these folks? Jason Hull (13:10) So, well, I'm gonna use a quick note just listening to that note from Ben-Dur-Roo. Hahaha So, sorry, I was thinking about. Yeah, property managers, they're one of their primary goals. What gets them access to more deals is just being connected to more investors. They want to get more clients and they want their existing clients that they love that want to get into more property, help them find more property more quickly. So how can property managers start to educate their clients, these investors on tax liens and tax deeds, what would be a good way for them to start being self-educated enough that they could go and educate them about this so they can create more business? Brian Seidensticker (14:02) Yeah, I mentioned our website with resources section, but there's I host a podcast as well called Tax Sale Insiders where I'm interviewing industry professionals, interviewing attorneys, interviewing folks that are real and legitimate in the space. And I started that podcast because there wasn't a whole lot of real and legitimate information out there. ⁓ Now, truth be told, it's it's Jason Hull (14:07) to the podcast. folks that are real, legitimate space. And I started that podcast because there wasn't a whole lot of ⁓ real and legitimate information out there. ⁓ Now, truth be told, it's it Brian Seidensticker (14:29) can be pretty, ⁓ what does my wife say? ⁓ If you want any assistance in going to bed at night, it's probably a good podcast to listen right before bed because I'm interviewing attorneys, right? it's, Jason Hull (14:29) can be pretty. What does my wife say? If you want any assistance in going to bed at night is probably a good podcast to listen right before bed because I'm interviewing attorneys, right? They're not super thrilling. Brian Seidensticker (14:45) are not, you know, small episodes of very high level of information. gets pretty deep, right? But for anyone that is legitimately wanting to get in the space, it is outstanding. ⁓ Jason Hull (14:45) These are not small episodes of very high level information. gets pretty deep, right? Yeah. But it's legitimately wanting to get in space is outstanding. Got it. It sounds like a good step maybe to check out the podcast, if there are, you know, check out your website, see if there's any attorneys that maybe you've connected with in a particular market. But regardless, they need to find a local attorney and maybe a good strategy for some of my clients listening and others would be to go find that local attorney and maybe do a little event with them. Bring your investors to the table. It could be a Zoom event, a virtual event, but bring this attorney. Be the interviewer. Make it a little bit more interesting. You'll have to be the interesting one, it sounds like. And interview them and ask the attorney to help you put together something that would be mutually beneficial for you, the attorney. and for the potential mutual client that you could share. sounds like a good strategy to start getting into some of these deals. Brian Seidensticker (15:48) Absolutely, there's, you know, while tech sales occur nationwide, right, and they there might be slightly different processes, but it's something that I'd say everybody could look into. It's not isolated to one market or another. can be a tool utilized, right, for anybody in the space. Jason Hull (16:06) So explain your services, your sites, how can, besides just doing research, how else can these facilitate what they're trying to accomplish here? So really what Tax Sale Resources is today is it answers all the basic questions that there weren't any answers to when we first got into space, right? was over a decade and a half ago. But at the time, and I say simple answers, things like... Brian Seidensticker (16:19) So really what Tax Sale Resources is today is it answers all the basic questions that there weren't any answers to when we first got in this space, right? This is over a decade and a half ago. But at the time, and I say simple answers, things like when are these auctions taking place? Where are they taking place? What are the properties associated with these auctions, right? And what are the information associated with those properties? Because typically, definitely at the time and still today, what's Jason Hull (16:34) When are these auctions taking place? Where are they taking place? What are the properties associated with these auctions? And what are the information associated with those properties? typically, definitely at the time and still today, Brian Seidensticker (16:46) but published as a list of partial numbers. So that doesn't tell you a whole lot. Partial numbers and tax amounts do. And so what we've done is compiled that all into, I haven't gotten trouble for this yet, it's a Zillow style platform where it's all loaded with all of that information. And so Jason Hull (16:46) what's published is a list of parcel numbers. that doesn't tell you a whole lot. Parcel numbers and tax amounts do. And so what we've done is compiled that all into, I haven't got trouble for this yet, it's a Zillow-style platform where it's all loaded with all of that information. Brian Seidensticker (17:01) if you're after a specific asset type, which I think property managers could certainly in their area say, hey, I want to target these parts of town. I want to target these types of properties with Jason Hull (17:02) If you're after a specific asset type, which I property managers could certainly in their area say, hey, I want to target these parts of town. I want to target these types of properties with certain square footage and number of beds and baths. You can settle that criteria up and the system will tell you here's what's going up for sale in given moment in time. And those types, it seems simple, That's a massive task coming from somebody that it all together and have a great team. Brian Seidensticker (17:11) you know, certain square footage and number of beds and baths, right? You can set all that criteria up and the system will tell you here's what's going up for sale, right? At any given moment in time. ⁓ and those types, it seems simple, right? And that, that's a massive task, right? Coming from somebody that put, well, ⁓ put it all together, right? And have a great team monitoring Jason Hull (17:31) monitoring that, but it's 8,000 plus auction a year, know, are millions of properties. And so it's a massive task. Brian Seidensticker (17:31) that. ⁓ but it's 8,000 plus auctions a year. It's, know, millions of properties. And so it's a massive task. So Jason Hull (17:39) So we simplify that, right? And that's essentially think of tax and resources as once you kind of know what you're doing in this space, right? So go do your research, to attorney, right? You've got your model, right? What you're looking for, you're looking to target. Then the platform can be all of the information for you to be successful from there. We like to call it all of the tools for knowing Brian Seidensticker (17:39) We simplify that, right? And that's essentially think of tax resources as once you kind of know what you're doing in the space, right? So go do your research, talk to attorney, right? And you've got your model, right? What you're looking for, what you're looking to target. Then the platform can be all of the information for you to be successful from there. We like to call it all of the tools for knowing not your knowledgeable space or knowledgeable investors in the space to actually be successful. And that's really what tax resources, the platform is now. Jason Hull (18:01) not in nodule space, not investors in the space to actually be successful. And that's really what tax resources the platform is. Now, that kind of dovetails into typically, right, this is one of the issues that some investors may come and get up against is a very cash intensive acquisition strategy because you have to typically have cashier checks, right, capital on hand, they have the auction, you don't have... Brian Seidensticker (18:09) that kind of dovetails into typically, right, this is one of the issues that ⁓ some investors may come up against is a very cash intensive acquisition strategy because you have to typically have ⁓ cashier's checks, right, capital on hand, day of the auction. You don't have 30 days to go close. Now there's some states where you can put a deposit down, but in general, most of the country works under a Jason Hull (18:29) ⁓ Brian Seidensticker (18:36) as is sale right then and there. I've actually even participated in auctions where they pause the auction and they won't continue until the person that won it comes down and provides their cash to purchase that asset. ⁓ Most folks, right, you don't have millions of dollars laying around. And that's really where Mountain Earth Capital, which is the other side of the house, came Jason Hull (18:47) Wow. Brian Seidensticker (18:57) about, which is working with local investors in helping provide the capital and Jason Hull (18:58) came about, which is working with local investors and helping provide the capital Brian Seidensticker (19:03) in acquiring those properties. ⁓ Now, I'll stop short in saying that we're all lender. We're not a lender. This is not a lending scenario, but we can be a capital partner for folks that want to use this as an acquisition strategy and have a model that is already successful or have a great ⁓ model in mind and want to pursue it because we can be the capital that Jason Hull (19:03) and acquiring those properties. Now, I'll stop short and say we're lender. We're not a lender. This is not a lending scenario, but we can be a capital partner for folks that want to use this as an acquisition strategy and have a model that are either A, already successful, or have a great ⁓ model in mind and want to pursue it. Because we can be the capital that Brian Seidensticker (19:26) on the day of action and buying those assets. Jason Hull (19:27) on the day of action and buying those assets Brian Seidensticker (19:30) in kind of a bridge type scenario where you have an end goal in mind. And so that's what Mountain North Capital is, is the access to the other major problem, right? The harder problem. We solved the easy questions and problems back in 2010 and then in 2020 we solved the second half, which is the capital aspect for folks that want to participate in this acquisition strategy. Jason Hull (19:30) in kind of a bridge type scenario where you have an end goal in mind. And so that's what Bound Worth Capital is, is the access to the other major problem, right? The harder problem. We solved the easy questions and problems back in 2010 and then in 2020 we solved the second half, which is the capital aspect for folks that want to participate in this acquisition strategy. Got it. Do some get involved with lenders trying to do these deals or hard money lenders or? Yeah, I think there's probably three avenues of, let's say four. Brian Seidensticker (19:57) I think there's probably three avenues of, I'd say four avenues of capital, And if I were to rank them in the least cost, if you have cash on hand, great, right? That doesn't cost anything. If you can get a line of credit out on some other asset or assets, right? Then that's a least cost effective or cost. Jason Hull (20:07) Right, cash is king. Brian Seidensticker (20:21) least costly ⁓ avenue, hard money lenders are another one, right? Where, if you've got credit available and have those hard money lenders that you can utilize, that might be one that is available. ⁓ I would caution though that not caution, but not all hard money lenders are aware and comfortable with tax sales. So that's something you got to work through with them. And then most folks don't have access to those or you have access to those until you kind of max all those out, right? And then Jason Hull (20:22) least costly avenue. one that is available. Okay interesting so Brian Seidensticker (20:47) You know, our, our source of capital is a very different source of capital allows folks to continue buying when typically folks have to stop buying and run out of other sources. Jason Hull (21:01) Yeah, so they've got to find the cash, they've got to find the funds to be able to do these deals and they move quick, like real time sometimes at these auctions. How do these auctions differ from the foreclosure auctions and some of these sort of deals? Brian Seidensticker (21:10) Yes. I'd say they're similar for, so for most folks or folks that are familiar with mortgage foreclosures, a lot of time, this procedures are very similar. ⁓ now the biggest difference is the type of title that you get at these auctions. And this is why banks don't typically touch these types of assets. Cause you're essentially buying a quick claim deed. Now that quick claim deed comes with headaches, right? You have to potentially do some quiet title, which is probably the most common thing that you got to deal with. ⁓ and you. Jason Hull (21:17) I'd say they're similar. So for most folks, there are folks that are familiar with mortgage foreclosures, a lot of times, these procedures are very similar. Now the biggest difference is the type of title that you get at these auctions. And this is why banks don't typically touch these types of assets, because you're essentially buying a quick claim deed. Now like quick claim deed comes with headaches, right? You have to potentially do some quiet title, which is probably the most common thing that you got to deal with. And you... Brian Seidensticker (21:45) may or may not most of the time you don't have to deal with any other liens on the property. Right. And so those are things that most people don't understand. That's also a reason why a lot of hard money lenders don't really like the space and also a reason why banks won't touch it. Right. They don't want to go through the effort of learning all of those things at the scale that we're talking. Right. Because there, you know, there's probably four to five billion dollars of real estate sold like this annually, which Jason Hull (21:46) may or may not most of the time we don't have to deal with any of the liens on the property. Right. And so those are things that most people don't understand. That's also a reason why lot of hard money lenders don't really like this space. also a reason why banks won't touch it. They don't want to go through the effort of learning all of those things at the scale that we're talking. Right. There's probably four or five billion dollars of real estate sold like this annually. Yeah. There's plenty for most of the folks listening but for banks that's small drop. Brian Seidensticker (22:10) is plenty, right? For most of the folks listening, but for banks, that's a small drop in the bucket compared Jason Hull (22:15) budget compared to traditional real estate. And so that's one thing to keep in mind is the the actual ad there, the logistics of ⁓ registering for the sale, participating in the auction, right? That's all very similar, right? Underwrite properties, that's no different. The biggest difference is when it comes to underwriting the title, right? You have to keep that in mind. That's also one of the things that Mountain Rock Capital Brian Seidensticker (22:15) to traditional real estate. And so that's one thing to keep in mind is the logistics of ⁓ registering for the sale, participating in the auction, right? That's all very similar, right? You underwrite properties, that's no different. The biggest difference is when it comes to underwriting the title, right? You have to keep that in mind. And that's also one of the things at Mountain Earth Capital. provides is we understand that it can kind of people Jason Hull (22:39) provides is we understand that it can kind of help. Brian Seidensticker (22:42) avoid pitfalls because we're interested in making sure that they're successful also. ⁓ That's the biggest difference is just the additional underwriting involved on that. Jason Hull (22:42) people avoid pitfalls because we're interested in making sure that they're successful also. That's the biggest difference is just the additional underwriting involved on that one. Got it. So maybe it would be a good first place to start would be to leverage the expertise of Mount North Capitol, go through one of these processes before you start trying to wing it on your own, perhaps. Yes, mean, I guess without completely tuning our own horn. Brian Seidensticker (23:06) Yes, I I guess without completely tooting our own horn, I would recommend that obviously I'm biased, but for folks that are somewhat new to the space, but at least understand real estate, understand how to manage that real estate, which ⁓ majority of listeners fall into that bucket and just want to utilize this, then Mountain Health Capital can be the perfect partner to work with in that regard. Jason Hull (23:14) that are somewhat new to this space, but at least understand real estate, understand how to manage that real estate, which majority of listeners fall into that bucket and just want to utilize this, then Mount of Capital can be the perfect partner to work with in that regard. Got it. What are some of the big questions that people have when they start getting involved in this that they should be aware of? Brian Seidensticker (23:36) well, we've, we've covered some of them already, but it's like, what are, what are the other, I'll say unknown unknowns, right? Of like, what, what should I be aware of that I haven't asked about, right? And we've touched, you know, the hate, you know, making sure that you speak with attorney, right? Making sure that you're actually underwriting every property. And I don't worry about this as much for, for tax deed buyers because they're used to underwriting properties. There's a, on the taxing side, there's, there's kind of a Jason Hull (23:37) Well, we've covered some of them already, but it's like... say unknown unknowns, right? Like what should I be aware Brian Seidensticker (24:05) a myth out there that there's value in every tax lien sold. And that's not the case because there's tax lien sold on worthless pieces of property. So underwrite your property just like you would normally, ⁓ make sure that you understand the title aspect, ⁓ you know, of, of the property that you're acquiring and what other I would call garbage are you going to have to deal with? ⁓ and then, you know, just making sure that you have a valid and good exit ramp. Jason Hull (24:06) myth out there that there's value in every tax lien sold and that's not the case because there's tax liens sold on worthless pieces of property. So underwrite your property just like you would normally. Make sure that you understand the title aspect of the property that you're acquiring and what other item called garbage you're going to have to deal with. And then just making sure that you have a valid and good exit Brian Seidensticker (24:31) Right. Especially if we're going to partner with folks, want, we're not Jason Hull (24:31) ramp. Especially if we're going to partner with folks, we want... Brian Seidensticker (24:34) interested in the long-term hold strategy. We want to be that, Hey, let's buy the property. Let's get it stabilized. Let's make sure the title issues are squared away. Then go get normal financing, right. At a lot better rate, get us out of the way. And then you can hold it, you know, for the term of however long you want to own that rental property. Right. And we've worked with several folks that are using that strategy of working with us in that, in that short period of time. And that's like. Jason Hull (24:34) We're not interested in long-term hold strategy. We want to be that, hey, let's buy the property. Let's get it stabilized. Let's make sure the pilot issues are squared away. Then go get normal financing at a lot better rate. Get us out of the way. And then you can hold it for the term of however long you want to own that rental property. We work with several folks that are using that strategy of working with us in that short period of time. Brian Seidensticker (25:00) If you execute that playbook, you can be very successful. Jason Hull (25:01) If you execute that playbook, you can be very successful. Does that cover then most of the major potential pitfalls that people fall into when you see them getting started with this? Yes, I think if you do it the right way, you do your research, right, and you don't just blindly go start buying items, then you'll be successful. Where people typically get burned is they look at Zillow for pictures. Well, these properties are distressed, right? These are more distressed than mortgage proposals. You definitely need to grab a private. Brian Seidensticker (25:10) Yes, I think if you do it the right way, you do your research, right? And you don't just blindly go start buying items, then you'll be successful. Where people typically get burned is they look at Zillow for pictures. Well, these properties are distressed, right? These are more distressed than mortgage foreclosures. You definitely need to try to the property because Zillow might be 10 years old and shows a nice property there. Well, in the last three years, you know, when it Jason Hull (25:32) because they might be 10 years old and shows a nice property there. Well, in the last three years, know, Brian Seidensticker (25:37) first went delinquent through the foreclosure process, they could have had a fire in the back and it's a tear down. These are all things that maybe normal real estate investors don't think about, but that is the type of assets that you might encounter in this space. So it's just doing your research like you should, or any real estate investor should. Jason Hull (25:37) it first went delinquent, right, through the portfolio process, they could have had a fire in the back and it's a tear down. These are all things that maybe normal real estate investors don't think about, right? That is the type of assets that you might encounter in this space. So it's just doing your research like you should, right? Or any real estate investor should. Do these always have to be done in person? Is there a way to do this? any of these remotely or is that just dependent on some markets? Brian Seidensticker (26:03) So the auction platforms in attendance typically can be done remotely. that's part of working with Mountain Earth Capital is some of the many of the auctions we still get great deals are live. But that's part of the services we provide is actually having bidders that attend the auctions. And so if you're in California, for example, and you want to participate in auctions in Texas, typically you wouldn't be able to do that. But through our program, you would. ⁓ Jason Hull (26:13) Many of the oxygen-re-stemming great deals are... So if you're in California, for example, and you want to participate in auctions in Texas, typically you wouldn't be able to do that, but through our program you would. Interesting. Brian Seidensticker (26:30) On other hand, are almost every tax deduction in Florida is online these days. And so if you wanted to go it alone and participate in these auctions remotely, about 70 % of the country is online ⁓ post COVID. Jason Hull (26:31) And there are almost every tax deduction in Florida is online these days. And so if you wanted to go it alone and participate in these auctions remotely, about 70 % of the country is online ⁓ post-COVID. Got it. Yeah. They just doing this on zoom or Google meter. Brian Seidensticker (26:51) Yeah, well, they know they, you they have platforms, auction platforms that the counties have contracted with and utilized for the sale of property. So instead of raising your paddle, you're clicking a button. mean, the auction is executed the same, but allows it, you will anybody to participate in them at this point? Jason Hull (26:55) that the counties have contracted with. Interesting. Lies to the sale of property. So instead of raising your paddle, you're clicking a button. Yeah. But a lot of that really needs to be put in. Yeah, got it. Okay, well that's really cool. So, well let's get your info. How can people reach you and reach both of these entities that you've got and. And then any parting words that you have for those that are wanting to get involved in this? Brian Seidensticker (27:28) Yes, I think the easiest well as far as the two websites for folks that want to check it out, right? Taxsaleresources.com mentioned that earlier on the Mountain North Capital side is mountainnorthcapital.com You can check that out. If you want to get in touch with me, go to TaxsaleResources.com and there's a There's a phone number on there, call the phone number. There's actually a real person on the other end answering it. It's not an AI agent. We haven't made that leap. I still believe that having real people on the other end is important and just tell them, yeah, I heard Brian's caught me a podcast on Jason's or took me and Brian on Jason's podcast. I'd like to talk to more about, you know, XYZ and they'll get you in touch with. Jason Hull (27:55) I still believe that having real people on the other end is important. Just tell them, I heard Brian's podcast on Jason's, or take me and Brian on Jason's podcast. I'd like to... Perfect, awesome. Cool. Well, Brian, appreciate you coming on the show. This is very interesting. think a lot of my clients, This might crack open a new idea for them, another growth channel that they could leverage as a resource for their investors. And so I appreciate it. Thanks so much. All right. So those of you listening, if you've ever felt stuck or stagnant and you want to take your property management business to the next level, reach out to us at doorgrow.com also. Brian Seidensticker (28:25) Thanks for having me, Jason. Jason Hull (28:36) Join our free Facebook community just for property management business owners at doorgrootclub.com. And if you would like to get the best ideas in property management, join our newsletter at doorgrow.com/subscribe And if you found this even a little bit helpful, don't forget to subscribe and leave us a review on whichever platform you saw or heard this on. We'd really appreciate it. And until next time, remember the slowest path to growth is to do it alone. So let's grow together. Bye everyone.

DGS 312: Optimizing Your Business for Success: Insights from Multi-Billion-Dollar Entrepreneurs

Do you ever look at other property management companies and wonder how they were able to grow and scale to thousands of doors? In this episode of the #DoorGrowShow, property management growth experts Jason and Sarah Hull share insights they gleaned from successful founders and CEOs of multi-billion-dollar companies. You'll Learn [00:59] Execution is More Important Than Good Ideas [11:51] Narrowing Your Focus to What You're Best At [19:41] Ask Your Target Market [30:33] Everyone Should be Focused on One Goal Quotables "There's no shortage of ideas. It's execution that's the hard part." "Everyone thinks… if I scale, I've got to do more. And actually, you have to do less to be able to scale…" "A lot of times we get caught up in creating systems, inventory, things that actually cause waste or over-optimizing each individual department or each individual step, but it actually reduces the overall goal of optimizing." Resources DoorGrow and Scale Mastermind [https://www.doorgrowacademy.com/courses/mastermind] DoorGrow Academy [https://www.doorgrowacademy.com/] DoorGrow on YouTube [https://www.youtube.com/channel/UCC1mGYT2Sw0LOe32hO_QdNg/featured] DoorGrowClub [https://doorgrow.com/] DoorGrowLive [https://doorgrowlive.com/] Transcript Jason Hull (00:00) a lot of times we get caught up in creating systems, inventory, things that actually cause waste or over optimizing each individual department but it actually reduces the overall goal of optimizing for making more money. All right, I'm Jason Hull. This is Sarah Hull, the owners of DoorGrow, the world's leading and most comprehensive coaching and consulting firm for long-term residential property management entrepreneurs. For over a decade and a half, we have brought innovative strategies and optimization to the property management industry. At DoorGrow, we believe that good property managers can change the world and that property management is the ultimate. high trust gateway to real estate deals, relationships, and residual income. At DoorGrow, we are on a mission to transform property management business owners and their businesses. We want to transform the industry, eliminate the BS, build awareness, change perception, expand the market, and help the best property management entrepreneurs win. Now, let's get into the show. Okay, so we recently kind of split paths, right? so that you could go learn some stuff and I could go learn some stuff. So we usually do everything together. So, but we had, which I love, but we had two really cool opportunities. One I was very much more interested in than the other, because I was learning about AI, which I've been geeking out on. And then you went off to go to a profit event. And was really cool. We went to the first day together, but the second and third day I was in. AI workshop, geeking out with some of the best on AI. Cool. I would love to hear what you took away from this event and what you learned, and maybe you can share that. I wanted to go over my notes on one speaker in particular. I was kind of going back and forth between two of them and I think this is the one that I landed on. at a different date I could talk about the other one because you weren't there for either one of them. But on the second day, I'm just gonna call this like notes from a billionaire and not just a billionaire but a multi. Billionaire and not just multi-billionaire but someone who is the founding member and CEO of I think they said they grew it to like it was a ridiculous number like 740 billion or it was a big it was a big number it was a very large impressive number and he was so nice I actually had a conversation with him before I even realized who he was I was chatting with him I wish I would have known Like I recognized the name and then I saw him speak and I went man. I would've asked him a different question So I'll do a quick little intro and then I'll kind of share my notes from what I wrote down while he was presenting so intro his name is Jeff Hoffman and For those of you that don't know the name Like I didn't know the name before as soon as I say the name of the company you'll instantly go. okay No, know the company The company is Priceline. So he is one of the founding members of Priceline. They started it and scaled it to many hundreds of billions of dollars. This is some of the advice that he had shared with us in his Speech because I got to hear him get up and speak and present to the entire room. So The first thing that I wrote down I Don't know if he can be credited with saying this or if he was quoting someone else But he said it so I wrote it down because it resonated very much was ideas are welcome here But execution is worshiped And I think that's really powerful because how many times do we all have this great idea, right? my God, I had this idea. my God, I had this idea. my God, we should do this. We should do that. What if we did this? There's no shortage of ideas. It's execution that's the hard part. It's turning an amazing idea into something and bringing that to life and bringing it to fruition. So I love it so much. That's good. Yeah. too much attention a lot of times on the idea and the planning and all this stuff, but actually executing and actually getting something done, that's really all that matters. It doesn't matter. You can have a million ideas. If there's no execution, then who cares? So, okay. So I think my mom is a great example of this. Everyone, think mostly everyone knows Elf on the Shelf. So my mom, before Elf on the Shelf was a thing, she created it. She just didn't do anything with it. She only used it like for me and my brother, but we had an elf that would come and visit and kind of keep an eye on us. And he would do fun things and he would pop around to different places in the house. So every time in the morning we would wake up and he would be in a different place or sometimes he would be doing like an activity. He'd be like baking or, you know, riding a bike or whatever. And it was so funny because when you look back on it, I went, mom, like, that was off on the shelf and it's like multi-million dollar company. And she went, yeah, I wish I knew that. But she was just trying to do something fun for her kids. So she had taken that idea because it was, it was a great idea. And she executed on it, but she never brought it public. Can you imagine what would have happened if the execution was done on a larger scale? So she'll probably hate the fact that I'm calling her out on that. But I think that'll be her. multi-million dollar missed story. Yeah. Yeah. So some of the questions that Jeff had asked when we're thinking about ideas, because we all have ideas. Some of them are good. Some of them are questionable. And some of them we can say like, yeah, that was a dud. So this is kind of a framework to take you through to figure out, is this worth executing on? One is. Is this a problem? So you have to ask yourself, is this an actual problem? Like what you're doing, does this solve some sort of problem? And then bonus points if it's a big problem, right? So if we go back to the story of Priceline, many, many years ago, those kiosks that are in every airport that you can just check in on, you do not need to go and talk to a gate agent or a ticketing agent. They didn't used to exist. You used to have to go stand in line and wait forever to get your ticket and your boarding pass and perhaps give somebody physically give somebody your bag and a lot of times people would miss their flight because the line was so so so long and you never knew ahead of time like is this gonna be a 10 minute line or is this gonna be a two hour line so people would miss their flight And at one point, he turned around and he was in the airport, turned around, looked at the line and went, wow, this is such a crazy long line. And he decided, I'm going to start interviewing people right here and right now. And he went around asking people individually, how long have you been waiting? Wow, what happens if you miss your flight? Wow, what would you do? Would you think it would be valuable or beneficial if there was some sort of service where you didn't need to talk to the gate agent? And people were bidding on it. They were bidding. They were like, I'll give you $10 if you can get me my ticket without talking to the gate agent. And then somebody else will go, no, forget $10. I'll give you $50 for that. And somebody else will go, oh, I must get there today. I will give you $70 to get there today. People were bidding on it in line. So he realized, one, there's a problem, but actually it's a big problem. So he knew he was on to something right there. The second question is, is there a better way to do this? So is there a better way to check in for your flight than waiting in line and talking to a gate agent? Yeah, there sure is. It just hadn't been invented yet. But is that the best way to do it? No, absolutely not. So there was a better way to do something. And the third is, is there a value equation, which all that means is would somebody buy this? And he knew that one, he had a problem and it was a big problem. Two, there was a better way to do it. And three, people would definitely pay for it because people were bidding on it while he was standing in line. People were like, wait, do you know something we don't know? Like, I will give you money if you can just get me on the front line because I need to get on this flight. So hence how Priceline was born. So those are three questions that you can kind of ask yourself. If you're going, okay, I have this idea, should I? Should I do this? Should I act on it? Should I create something with this? Yeah. Seems pretty simple. think a lot of times we get really disconnected. you know, we study stuff, we learn stuff, we think we know, but when you actually go talk to your target audience and do a little bit of product research interview, you know, you can find out a lot of things that problems they have, things they need, and actually connect with, you know, what you're wanting to sell them may not actually work. So yeah, I think that'd be super helpful. All right. So then he kind of gave tips on, well, if you are looking to seriously, massively scale a company because it's not, let's face it, not every company gets to a million, certainly not even to a billion and absolutely not to hundreds of billions of dollars. Right. So These are tips that he had given the room in order to help you scale. And everyone thinks, you know, if I scale, I've got to do more. And actually you have to do less to be able to scale at that large of a size. he said, find your gold metal product or service. So for them, if you remember, if you would go on Priceline when it first launched, there was different tabs. the top right you could book a flight you could book a hotel room you could book a cruise you could get a rental car you do a vacation package like they did all the things yeah and they were scaling but it wasn't to the size that they wanted to get to and they went okay if we only did one thing what would it be like what are we the best at the world at and for them it was hotel rooms so they said okay It's not that we have to cut the other stuff. It's just that we're not going to market it. We're not going to advertise it. We're not going to talk about it. We're not going to put any money, time, or energy into that service. It's just there. But what we will do is we'll go all out on hotel rooms. because they were the best in class at hotel rooms. So they didn't cut the other things out. Go on there now, you'll still see, but their bread and butter is hotel rooms. So the other things are still available. It's just that they never, if you look at any Priceline commercials, you'll never see anything other than hotel rooms. Why do think that is? Because they're marketing what they're the best in class at. So that is their top service. Next is find your gold medal talent. So what was their gold medal talent? Any guesses? Don't cheat, don't lie. I know the answer because I was there. I don't know. I would imagine it's related to hotel rooms. So their gold medal talent are probably the best hotels. It was their algorithm. Okay. for connecting people to hotels. So their algorithm was their talent. They had a talent in that. What is Amazon's? Shipping. Shipping. It's delivery. So if you remember, Amazon didn't start selling everything on the planet. It started as a book store. That's it. They only sold books. And what I didn't know is that when this whole internet thing was blowing up. were three companies that were kind of becoming rising to the top all at the same time. It was Priceline with Jeff Hoffman and Partners. There was eBay. His name was Jeff and Pierre. Jeff and Pierre. And then there was Amazon. And that's Jeff Bezos. So somebody had asked him, what does it take to be successful in this internet thing? And he said, just find somebody. who's a really good Jeff. They all had the best, they were the best in class at something and then they had the best in class at a specific talent. So Amazon, they got fantastic at shipping and they only did books. And Jeff Bezos said, you know, when we get, I'm only doing books right now. And then when we get to a certain size with books, Then I want to branch out and then we'll do everything. But I don't want to do everything first right now. I just want to build our name and our reputation solely on books. Why? Because they were amazing at shipping. And now anytime that you buy something online, usually what's the first thought you think? Amazon probably has that. Why? Because you know they'll ship it. And then you need to shape your brand. That's the third piece of this. you need to ask yourself what question are you the answer to? So for them, I need a hotel room. Where do I go? right, priceline. Or, they did a lot of this too, I want a $200 hotel room but I don't want to $200 on it, I only want to spend, you know, $100 or $80. Where do I go? Priceline. So shape your brand around that. And then you've got to, in that arena, you've got to find your brand asset. So everyone goes, know, why should I work with you? I just watched a Jeremy Miner video, like at his live event, and he had a microphone and he went up to someone in the audience and he said, hey, why would someone work with you? I've seen these videos. And he let them answer. And he goes, mm-hmm. Okay, and then he goes to the next audience answer and he goes, why would someone work with you? And he does it again and he goes, okay, so all of you guys really sound the same. You're in wildly different industries and companies, but you all sound the same. Yeah. Right? So you can't sound the same as everybody else and expect to stand out. So if you could only give one reason that somebody would work with you, what would that one reason be? It's not about all the reasons, it's about the one reason and that shapes your brand. Yeah. Yeah. So I thought that was really good. If you aren't sure, you don't know, if you're like, I don't know, there's a lot of reasons why somebody wouldn't work with us. Ask your customers. Yeah, like why did they pick you? Why? What is the one reason? Don't just say why did they pick you because then they'll go, because of X, Y and Z. Great, was it X or was it Y or was it Z? What is the one main reason that you decided to work with us? And do that ask 10 people. If you don't have 10 people, then keep selling until you can get 10 people. Because that data will tell you what is it that your customers have found in your messaging even though maybe you didn't do a great job at delivering it. So I thought that was really interesting. Yeah, that's good. They talk about broadcasting versus what they call narrow casting So this is focusing on the right people not just any person Because for every product for every service for every brand There are the right people and Then there's everybody else So if you're trying to close every deal, it's almost like an impossible game Who do you target? Will we target people? Everyone. People? Really? Who do you target? Well, I work with real estate investors. Well, geez, okay. There's only like hundreds of millions of those in the world. Which ones do you target? Yeah. Right? So some of this goes into our client-centric mission statement when we take our clients through their company culture stuff. But we want to get really, really clear on who are my people. Not just who are people that could buy this. What are the right people to buy this? To work with me, to choose this, right? There's a difference. Right. I mean, this makes sense. know, yeah, you got to really be specific because if you target everybody, you target nobody. Then then you're just more noise in the marketplace. So if you want to be, you know, like we're pretty niche at DoorGrow, we target long term residential property management companies in the U.S. Like that's our target audience that do third party property management. So that's our... Do we get other types of clients? Sure, but that's our bread and butter. That's who we focus on and that's very specific. Those are the people we know we can help. And I'd say we're the best in the world at that. yeah. Right. So I think Sharan calls it a dog whistle. Right? Speak to your people and anyone who isn't your people, they won't hear it. It's not for you. Go ahead, I don't want you to hear it. Just the dogs, Just the right ones. They'll hear it. Okay. This I liked a lot. He said, focus on your second slide customer. So find your yeses instead of overcoming nos. Every sales training in the world goes, let's overcome objections. Let's overcome no. Let's work a no into a yes. Let's see what we can do to turn it around. Overcome objections. No, don't overcome objections. Just find the yeses. Second slide. Yeah, so you know when you have like a whole presentation prepared. Yeah, and The example he gave is he said he went out with one of his sales reps And there was like a 20 slide presentation that they that was like their pitch deck, right? so he spent the day with a sales guy and the first meeting they went to He got through all 20 slides and the woman was like, yeah, this sounds really good. I'm gonna think about it I think we need to go back to you. like, yeah, yeah, like it wasn't a solid yes, because she didn't commit, she didn't sign up. But she was open to it. She's like, yeah, let me think about this. Like, let me take it up to management. We'll do something. So he got out of that meeting and he said to the sales rep, said, how do you think that went? Sales rep was super proud. He went, yeah, that was a great pitch. She's definitely going to buy. Like, she's going to come back around. Like, that's a deal that'll close. It's like in the pipelines. about to close. Jeff said, yeah, I just didn't say anything. It's like, I just didn't say anything. I'm like, I'm not going to skew it. I just want the data, right? So he goes into another sales pitch, same sales rep. Slide two out of 20, two. They look at each other and went, oh my God, you're exactly what I needed. We're ready. And the sales rep was like, well, wait, let me tell you more about the rest. And he's like nudging the guy. He's like, sign them up. They're ready. They don't need more information. They don't need anything else. They're ready to go right now. Stop trying to complete the pitch. It's done. You don't need the other 18 slides. They already said yes, and they said yes on slide two. Find your slide two yeses. Don't try. to keep on going, don't try to turn the nose and do yes, don't overcome their objections, find your slide two customers. So what they actually did, this I thought was so interesting. This lit up my brain because I like data so Okay, I'm going to pause you. So nice little hook. Now we're going to go to our sponsor and then everyone can hear what you're about to Oh, that's so good. All right, so this episode is sponsored by Blanket. So really like the team over at Blanket. Blanket is a property retention and growth platform that helps property managers stop losing doors, add more revenue, and increase the number of properties they manage. Wow your clients with a branded investor dashboard and an off-market marketplace while your team gets all the tools they need to identify owners at risk of churning and powerful systems to help you add more doors. So check it out, it's an amazing property retention platform. Even if it's switching owner hands, you keep the property. So check out Blanket. what he did is he profiled people. know that sounds like nowadays we're elect. Don't profile that. No, profile our best customers who your best ones. Okay. That target audience. Who were your easiest sales? Who are your biggest fans? Right? Figure out what do they have in common. They all have something in common, but what is it? So for them, they figured out that a rep that worked at the hotel chain that went, huh, we have all these extra hotel rooms. What do we do with them? Like, how do we sell them? That was their job. It's just to figure out how do we sell more rooms. Those were like his target audience. The reps that were brand new. like one to two years on the job. That was not it. Because they're so new that they're not willing to take a risk yet. So they were not very likely to close. It's not that they wouldn't close. not that you couldn't close them. It's that it wasn't like almost a guarantee to close them. Also, reps that have been in the job for like 15, 18, 20 years. Yeah. Also not it. Why? Because they know how to give a shit. He's like, they're out the door, they're for the door, they're about to retire. They don't care. They don't care if they sell more hotel rooms. They just care that they keep their job until they can retire. So they're not, again, they're not almost practically guaranteed to close. So if you were in this bracket or in this bracket, he was like, yeah, it's not you. I'm not gonna target those people. It's the people in between. It's the people that have been there for like three to, you know, somewhere between like that three to fifteen, three to fourteen years. Those people were amazing because they're not afraid to speak their opinion. They're looking to kind of make a name for themselves at this point. And they're not afraid to take a risk. But they are looking to do something big. Those were his people. How do think you figured that out? as he profiled his best customers again and again and again. And you went, huh, look at that. The new ones, they don't do it. The old ones, they don't do it either. It's only this slot in the middle. And those, those are our people. Got it. I like that. Yeah, right? Makes me think, like, with our clients, who is almost always a guarantee to close? That's the profile of the target. Yeah. That's exactly what you want to do, because you want to profile the ones. It's like a shoe in. If I didn't close this, it would be insane. Right? They even took it a step further. actually created a 100 points scoring chart. Yeah. And there were different questions. One of the questions was that one, for example, like how long have you been with your company? So if you're like one to two years, he would give them like negative 20 points. yeah. Right? So now it's like, your score just went down. now you answered this way. Your score went down again. Your score went down again. Same thing with those, you know, the older ones. They would be like a negative 40 though, because they really didn't care. It's easier to close the newer ones than it is the older ones. So like, oh, I've been here 18 years. He's like, cool, negative 40 points. In the middle though, he might go, okay, there's like 25 points. Maybe there's 15 points. They just scored 15. Now what else? So you have to ask these questions and what his team got so good at doing once they implemented this hundred 100 point score sheet is They can ask a couple questions do the math in their head and then immediately decide is this worth my time? So if you knew you were talking to a 40 Go to lunch It's not you're not gonna close it. It's a 40 out of a hundred like go home That's it. But when you would get your 80s when you get your 90s, you'd be really excited. Yeah. Oh man. Okay. Let me invest in this So they created this whole scoring chart. I thought that was so brilliant. Yeah. I mean, that's pretty standard feature in a lot of CRMs is lead scoring. coming up with a rubric or an algorithm for scoring your leads can be pretty significant. So yeah, it's a difficult thing to figure out, though. You've got to really know why which customers are good. So you can kind of figure out how do I score someone to duplicate these people. Right. Yeah. So good. And this is probably something that will help you figure out how to score people and what questions to ask and what do they all have in common. He said, spend a day in the life of your customers and do it often. So the story that he told us, there was a company that when it launched, he knew the guy. He was having a conversation with him and he said, Hey, why did you launch your company the way that you did? when every single market expert said it wouldn't work and you did it anyway and it worked and it was wildly successful but what made you go no I'm gonna do it anyway and the answer was well that's easy I didn't even ask the market experts so I didn't know that they didn't think that it wouldn't work because I didn't bother asking the market experts Jeff said well what did you do? He said, well, I asked my audience. Sure. I asked my customers. That's it. He said, OK, well, how did you do that? So in this little town, across the bridge on like the less nice side of town. The owner of this company, and I'll tell you the company in a minute, but the owner of this company, he would be in his office with his team all day. His team had MBAs, they were finance executives, they were accountants, right? Not, not his target audience. So he would get changed into jeans and a flannel shirt and a John Deere hat. He would go across the bridge to the bad side of town. and would sit in a diner all day long. Every Friday he would do this. And he would just talk with people who would come in there. He would just make friends with them. He would chit chat. He would ask them questions. And he would just gather data. And he used that data for his lunch. Do you have any guesses? Did I tell you? I think I told you this story. You probably did. Do guesses on who it was? Uh, no. Walmart. Oh. Sam Walton. Yeah, so this was Walmart. Okay. Every single expert said that will never work. And he said, yeah, I don't need to listen to experts. I need to listen to my customers. Right. Because the customers are going to tell you what they want. Yeah, they're the ones buying. So they know. So it doesn't matter what experts say. It matters what the customer says. Yeah, absolutely. It was so good, right? And he really, he got to know these people. So it doesn't matter what the market says. It doesn't matter what the expert says. It matters what your customers say. If your customers are going to tell you what they want, you shall listen. And now you'll have a successful product, regardless of what the experts say. The experts don't understand everything like your customers do. Listen to what they're telling you. So if you just get that data that allows you to do things that even other people would say, you're crazy, don't do that. And he didn't think it was crazy. He was like, no, I just, they're telling me what they want. I'm just going to do that. And he did. And it's still around today. Huge brand. Sometimes customers don't tell you what they want, but if you are connected with them enough, you can see what they're having problems with and what they're struggling with. And sometimes they just, think that that's normal. They're just like, yeah, this is, hiring's hard, you know? And then I'm like, cool, we built a hiring system that solves this problem, right? And so, but a lot of people just kind of say, yeah, it's, you know, it is what it is. And they don't really think that it's a solvable problem sometimes. So that's, that's where I think, you know, you need to ask your customer, but you also need to, sometimes your customers are wrong. Like they don't know. And you have to be able to be creative enough to figure out what. would they want if it was, you know, if they recognize this problem. And then sometimes you have to sell them, you attract, it's like we attract a lot of people at DoorGrow that think they want leads and they think they want digital marketing and they think they want SEO. And then we have to guide them towards what they actually need and sell them what they actually need, which is totally different. Yeah. So that's, that's, that can be a challenge. Maybe we'd be smarter if we just sold them what they were asking for, but. they wouldn't get as great of results. Yeah, I feel like though, I personally, I just don't feel good about doing it. Yeah. Because to me, that's just a money taker, right? Right. That's an order taker, that's a money taker. That's like, hey, I really need to grow my business and like, I think this will work. And then that's like, yeah, give me your money. sell you that. just give you a whole bunch of leads. And months go by and... Well, how come my business didn't grow? I only closed like four deals. Well, I just don't, I don't think I can really get behind that with integrity. Yeah. Yeah. It's not exciting to me. I know there are companies out there that will, and especially now with AI, like just be super careful with SEO. Be like extra careful at this point with SEO because SEO is literally dying. Like thing. Yeah, the whole game's changed. With AI. The whole game's changed. More people are using chat GPT than Google. It's been a huge disruptor. It's such a big disruptor that the antitrust lawsuit against Google has dropped. I mean that's massive. for those that don't know, just sum it up, the antitrust lawsuit. Well, Google was being sued because they had almost no competition. They dominated the search market like nobody could compete. And the closest competitor was like a small fraction. And so the government was going after them with an antitrust lawsuit. And then ChatGPT broke. All these AI tools and platforms came out. And now Google is no longer viewed as viable you know threat of a monopoly yeah and they may be losing this whole AI race which is super wild right yeah they're fighting they've got their AI tool all over the place Gemini is pretty good it's really good for a lot of things but it's not winning Yeah, yeah. yeah, with like, chat GPT was something nobody knew that could happen. Like we didn't even realize this was something we all wanted. We all wanted like some almost genius thing that we could talk to all the time to get all sorts of information. Yeah, quickly without having to dig and try and do our own research. So, well. Okay, we'll go one more story and then I've got a closing quote. So I think we all know at this point the brand 1-800 flowers they're huge now So before they used to be huge because they weren't always Jeff went out to go visit one of their shops And everywhere everywhere in the shop they had posters printed up like slopped on the walls every wall in every room, in the hallways, in the bathroom, in the garage, in every single room. And it was just printed up on the walls, sell more flowers. Why? Because that is what we're all about. That is the only thing that we care about is selling more flowers. We don't care about anything else. We are only here to sell more flowers. And every single person in this company exists for one reason and one reason only and that is to sell more flowers. So every single person, every single minute of every single day needs to be thinking, how can I sell more flowers? So it doesn't matter what their role was in the business, they need to be thinking, how can I sell more flowers? So he's walking down the hall and there was an admin. She did a lot of paperwork, answering the phones, things like that. She's got this huge stack of papers and she's walking down the hall with a stack of papers. And the owner says, hey, whatever her name is, Susan, hey Susan. And he points up to the wall and he goes, what are you doing right now? And she goes. puts the paperwork down, turns around, walks away. And Jeff said, well, what on was that? And he said, if you're not, we have a rule, if you are not doing something, that can somehow be connected to how does it help us sow more flowers? My rule is you do not do it. Ever. So whatever she was doing, clearly, was not connected to sow more flowers. So therefore, I reminded her, sow more flowers. And she stopped, promptly, what she was doing and went back to what she should be doing, which is sell more flowers. So they continue on this tour. They get back into the back of the shop, into the garage where they've got their van for deliveries. And they have a mechanic. The mechanic is underneath, one inch away. And he goes, hey. He goes, watch this. He goes, hey, Joe. He points at the wall. He goes, what are you doing right now? And Joe says, oh, well, I was installing this new filter on all of our vans because this new filter, it saves us X money dollars in gasoline per tank. I think it was $8. So we save with this new filter. We actually save like $8. per tank of gasoline. So I'm going to install each of the filters on our vans. And then what I'm going to do is I'm going to go inside and tell marketing to print up some coupons for $8 off. of a bouquet of flowers and we're going to run that as a promo because if we just saved eight dollars that means we have eight dollars extra so we might as run a promo and that'll help us sell more flowers. And he goes, yeah, it's brilliant. Do that. So the mechanic is thinking all day every day how do I sell more flowers? Now would a mechanic generally be thinking about selling flowers? No. He'd be thinking, how do I wrench on this? How do I fix that? What about the oil change? What about the tires? What about the spark plugs and the brakes? He's not thinking about selling flowers. But it wasn't lost on him because all day, every day, he's staring at a big sign that says, sell more flowers. So it doesn't matter what you are doing. If it's not connected to helping us sell more flowers, what you're doing does not fricking matter. This goes along with a book called The Goal by Elihu Goldratt. And The Goal, spoiler for everybody that wants to read this. operational book is to make money. And so a lot of times we get caught up in creating systems, inventory, things that actually cause waste or over optimizing each individual department or each individual step, but it actually reduces the overall goal of optimizing for selling more flowers, for example, or making more money. And so sometimes team members standing around doing nothing is more effective than them building more widgets for the next step because it just creates more waste or more inventory or like constraint. And so that's the idea is the goal is to eliminate all the constraints to create momentum so that you get that that money coming in and everybody should be focused on that goal because it's very easy to get caught up and like he could be super caught up and I'm gonna make the cars run hyper effective and efficiently but Maybe that just causes more financial spend or maybe that doesn't help them sell more flowers, for example. And so when everybody understands the overall goal and how they fit into that puzzle, then instead of just focusing on, I did my job or I'm doing this, they're focused on, is this helping the goal? And so I love that. I love that idea. And I think that's super important to get everybody on the team to focus on. Cause a lot of times everything's siloed. They focus on their little department. They focus on their little role and they forget the overall goal of the company is to make money. Right. So even like your property managers, your leasing agents, your operator, like everybody who's on what I would call like back end, they have the same job, which is to get more properties to manage. So even if you're not in sales, it doesn't matter. Salespeople, it's very obvious the connection. It's like, yeah, so close more contracts and close more deals and then I have more properties, duh. Great, but how does that apply to your leasing agent? How does that apply to your property manager? How does that apply to your receptionist who's answering the phone? How does that apply to your AI tool? So everybody and everything is aligned with the one goal of the business, which is I don't care what we do unless... we sell more flowers. I don't care what we do. don't care. There is no point in changing the tires if it doesn't help us sell more flowers. Right? So I don't need to hear just for that thing. If we don't sell more flowers, I don't need to change the tires. So they've got to be connected. And that was a great example of how somebody even so far removed from the back end of the business. He's like, Back end of the back end is the mechanic. And he's still focused on top-lingle. Yeah. Yeah. I mean, if you talk to your team and you ask them, what are you doing? And you had to sign up the set, like, you know, get more property management clients. A lot of you aren't focused on that. A lot of them are like, well, I'm just talking to every tenant all the time. I'm talking to every owner all the time. Is that helping the goal of you getting more clients? No, a lot of things aren't. Is it helping keep clients? Cool. That is part of getting more clients, is keeping the clients. But yeah, if it's not related to keeping clients or getting more clients, managing more properties, then there's a lot of bloat and a lot of waste in property management companies. We see it all the time. So much. Yeah. And we're really good at helping you see it. So if you want to make more money and you've got a decent number of doors, you've got 200 plus doors, come talk to us. Our program will be paid for, but probably just the first stuff we help you with in the first month. It's a no-brainer. Okay. Okay, then I'll close it out with this. Okay. He said, as a quote, don't chase money, chase excellence, because excellence follows money. I like it. Yeah, right? It's okay. Because a lot of that's people want. They're like, I just want to make enough money. I want to make more money. It won't matter if you're not excellent at what you do. Yeah. Yeah, well cool. Well, those of you listening, if you have felt stuck, stagnant, want to take your property management business to the next level, reach out to us at doorgrow.com. Also join our free Facebook community just for property management business owners at doorgrowclub.com. And if you want tips, tricks, ideas to learn about and to learn about our offers in DoorGrow, subscribe to our newsletter by going to doorgrow.com slash subscribe. And if you found this even a little bit helpful, Don't forget to subscribe and leave us a review on whatever channel you found this on. We'd really appreciate it. And until next time, remember, the slowest path to growth is to do it alone. So let's grow together. Bye everyone.