INVESTOR RESOURCES
CLIENTS
Factors for Real REI Success 5
HOW DOES YOUR BUSINESS STACK UP?
by Danny Johnson
any real estate investors tend to get caught in the trap of believing that since we have been investing in real estate for years that we have that many years of experience. “How many years of experience do you have?” “I’ve got 18 years of experience in real estate investing,” says the smug, overconfident me. “No you don’t,” says Jim Rohn as I’m listening to an audio of his from years long past. “You have one year of experience repeated 18 times.” OUCH! There is some truth to that statement. SUCCESS BREEDS COMPLACENCY Once we’ve worked hard to overcome the difficult push to get started and have built momentum in our real estate investing business, we can slack off a little and feel good about the progress we have made. This happened early on in my business and there was a long period of this “coasting” that cost me dearly. Most of the cost was from lost opportunities because I was not running my business efficiently. When I was in that spot, I didn’t even know what I didn’t know. I didn’t know how well my business stacked up against other real estate investors. There wasn’t a stan- dard to gauge my business. So when I wrote my book, Flipping Houses Exposed: 34 Weeks in the Life of a Successful House Flipper where I illustrated how I had generated 495 motivated seller leads and everything about how I marketed, analyzed, M
what I offered, and the deals I did, I thought I was doing really well. It took several years for me to realize that my conversion rate of roughly one out of every 45 leads was downright atrocious. I did only 11 deals from those 495 leads, and these were qualified leads where someone told me they wanted to sell their house. It was not just a marketing list. How embarrassing. After many, many more years of real experience I was able to get it down to turning one out of every five or sev - en leads into a deal. Let’s unpack what an efficient and profitable real estate investing business looks like so that we can see how we stack up. This will allow us to know where we should be looking to improve... and gain some more real experience. 5 REI FACTORS FOR BUSINESS SUCCESS After nearly 20 years running a real estate investing business, making all the mistakes in the book, growing through the huge downturn in 2008, flipping/wholesaling nearly 1,000 houses, being a part of several mastermind groups, hosting the Flipping Junkie blog and podcast, and interviewing hundreds of successful real estate investors, I’ve narrowed business success for real estate investors down to five factors:
1. Marketing Specialization 2. Sales Training 3. KPI Tracking 4. Structured Planning/Meetings 5. Systems and Processes (follow up)
32 | think realty magazine :: december 2021
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