Hey everybody, welcome back to the show! Today I’m talking to my buddy Bob Allwein. In this episode, we talk about scaling up. It’s one of the challenges he’s been through over the past few years. From a one-man band or solopreneur, if you wanna call that, to building a team of people. As a business owner, your responsibilities shift. Even when you’re a small team, when people are doing some of the work that you used to do, it’s still loaded with opportunities for things to go wrong if you don’t have the right team. Like people getting hit by trucks or getting sick or other things that happen in our business, it’s the life of an entrepreneur and that’s what we’re talking about today!
Mike: Hey everybody, welcome back to the show. Today I’m talking with my buddy Bob Allwein. We’re going to be talking about scaling up. And so it’s one of the challenges he’s been through over the past few years is going from kind of a one-man band, solopreneur, if you want to call it that, to building a team of people. And as a business owner, your responsibilities just shift. And even when you’re a small team and people are doing some of the work that you used to have to do, it’s still kind of loaded with opportunities for things to go wrong with the wrong person, or people getting hit by trucks, or getting sick, or other things that happen in our business. I mean, it’s kind of the life of an entrepreneur, so that’s what we’re talking about today.
Professional real estate investors know that it’s not really about the real estate. In fact, real estate is just a vehicle to freedom. A group of over 100 of a nation’s leading real estate investors from across the country meet several times a year here at the Investor Fuel Real Estate Mastermind to share ideas on how to strengthen each other’s businesses, but also to come together as friends and build more fulfilling lives for all of those around us. On today’s show, we’re going to continue our conversation of fueling our businesses and fueling our lives. I’m glad you’re here.
Hey, Bob, good to see you. Welcome to the show.
Bob: Hey, thanks, Mike. Glad to be here.
Mike: Yeah, yeah. And so, you know, it’s interesting. The ride that you’ve been through, from what I know about and what we talked about is just kind of growing your business to the point where, you know, we all aspire to build this business that just runs without us, right? And, I’ll say that’s maybe a journey more than a destination for a lot of us, right? But it’s not a straight line, right? It’s full of loopty-loos and sharp cliffs and all sorts of stuff, right?
Bob: It sure is. I tell you, a couple of years ago, I wanted to get myself out of the trenches, so to speak. I was literally driving a truck to the Home Depot and to the dump and made a decision that it was time to work on the business instead of working in the business.
Bob: And we’ve made huge progress in the last two years, and I’m excited about the progress. But recently, I’ve shed some light on some things that said, “Hey, maybe, you know, you went from 100-foot level to the 10,000-foot level pretty quickly, and you need to get back to maybe the 5000-foot level, and put your eyes and focus on some of the processes and systems to make sure that we have that under control before we jump up to the next level.
Mike: Yeah. Yeah, I think what happens is . . . and I’ve talked about that for years that our business, really any business, is like a stair step approach, right? You get on the first level and you’re doing a house or two a month. And then to grow, you have to bring on an admin or maybe an acquisitions person, you got to kind of grow. But I think what happens is we ended up, you know, it kind of comes down to one of two common things either something really good happens in the business, and you kind of get fat and happy for a while and it masks some other problems that are there. And/or you have a person that knows how to do the job, or you think they know how to do the job, and you just trust that they’re figuring it out, and they either leave or you find out down the road that they didn’t really know what they were doing. And then it’s like, too much time has gone by, you know, there’s a negative kind of response to that, right?
Bob: That’s true. I think we talked about this in my case a couple of weeks ago, you know, we got together for the Investor Fuel Mastermind and there was some homework there, right? And part of the homework was preparing your hot seat presentation. And I spent, you know, the week before the mastermind, Stacy and I we’re on vacation, which was awesome, and I wasn’t prepared. So I prepared on the Sunday before the meeting started. And I spent probably six hours on my laptop digging into my KPIs, and several light bulbs went off. And I realized that I had been working with my lead manager for the last three months, giving her multiple second chances, and the truth was in the numbers.
And I realized that, you know, I really just needed to step back, take that away, give it to someone else, but immerse myself in that because you know, that’s the front engine of the business, the lead management. So if that’s not clicking on all cylinders, something has to be done. So that analogy from going from 1000 feet to 10,000 feet, you know, I was up there at 10,000 feet on vacation a week before and I needed to be hovering back down in the 2000 square foot level for a couple of weeks, right?
Mike: Yep. Yeah, do you think . . . one of the things that happens is back to that desire to be less involved in the day-to-day, and probably a little bit of desire or belief that people are doing the right thing on our behalf and sometimes they’re not, right? You think those things kind of cloud our judgment? Sometimes it’s like, “Well, you know, they’ll figure it out, or it’ll work itself out one way or another.” Some of it is just because we don’t want to like have to get . . . we have too many other things going on, we don’t want to have to get back into that.
Bob: Yeah, I think that’s a very true statement. In this particular case, you know, we had some success with that team in place. And maybe we got a little bit on autopilot, and then life happens and I don’t want to go into, you know, too many details, but my lead manager was going through some serious personal issues. And, you know, we worked with her and worked with her and then finally we realized, “Well, this is really not operating the way it should be operating and maybe the personal issues have something to do with it. But we’ve tried to steer the ship in the right direction, and it hasn’t worked, so, you know, we have to dive back in and pay attention to it a little bit closer and make a change.”
Mike: Right. Right. So let’s talk a little about just as you’ve grown your team now, because you’ve grown quite a bit over the past year or two, right?
Bob: Yeah, we have. I met Adrian, probably two years ago, Adrian Nez, and he helped me put together my new approach [inaudible 00:06:50] really. He along with a couple other people I met Adrian and RJ and Cassie at a small group that Don Costa had, actually, put together a couple of years ago, and all those people really helped me go from a one-man operation to having a game plan to what I was going to focus on next.
And the first thing Adrian came up with was, “Hey, Bob, you’re Bob The Flipper and that’s great for your local community and the local realtors that know you as Bob The Flipper, but the people that are sitting in front of their computer right now back in Maryland don’t know who you are, and they’re not going to find you.” So we came up with Adrian’s help, a new name, Maryland Cash House Buyers, and put that website in place right away. And within the first month, we had a deal from our carrot site, and I hired Adrian’s company to do my SEO and set up the website and get things rolling there.
And then, we implemented a lot of direct mail marketing to drive more off-market deals because previously, most of our deals were coming from agent-to-agent referrals. As you know, my wife is a real estate agent and my son is my acquisitions manager. At the time when I met Adrian and those other folks, Michael was my buyer’s agent for on-market deals. And someone at the meeting said, “You know what, Bob? Your acquisitions manager is already working with you, he’s Michael. We need to turn him loose on off-market deals. So currently, and ever since then we’ve tagged team the off-market deals. I’ll go on an appointment with Michael or he’ll go solo, and I still get the final say on the purchase price on the deals, but he’s been tearing it up ever since.
So yeah, we’ve grown substantially. We put a couple other people in place. I mean, my first hire was Patty as my administrative assistant. Now she’s a full time office manager, she runs our property management arm of our business and then, she also handles our QuickBooks, she participates in lead management more so now than we probably like her to. But we have a plan for putting someone new in place there too.
And then our next hire was probably 7 to 10 months after that, we hired one project manager that didn’t work out, and we knew that pretty quickly. We hired a guy that we thought was going to be great because he had project management experience, and he really only lasted a week because he didn’t want to be managing our projects, so ended up hiring another guy that was previously a foreman for a granite installation company. He was, actually, a brother to my cabinet and granite supplier, and Oscar, he’s been with us for about a year now, and he’s just been lights out phenomenal.
Bob: He’s in the field daily and he gets a lot of the work done for us. We’ve been able to take some of the work that we pay contractors to do and have Oscar do that with some help and also have Oscar oversee the crews as they are out on the project. So it’s worked out.
Mike: So Bob, what lessons have you kind of learned from hiring and firing? You know, some people that worked out great, some that didn’t work out, you got some family members that work for you. And so what are some of the lessons you’ve learned about, you know, how to have a better batting average, if you will, if you were to bringing on two people on your team?
Bob: Sure, that’s a great question. I can go in two directions there. One would be working with family members. I’m going to make a note about that and come back to it.
Mike: Yeah, you can’t fire them. You can, but . . .
Bob: No, but the other is, the biggest lesson I’ve learned is hiring to the personality that works best with your organization. So I made two mistakes there. I mean, I hired one guy based on experience to be a project manager, and I had already heard the whole deal about, you know, do the DiSC assessment and make sure they’re a good fit for your organization. And I kind of dismissed that in this project manager role because I wanted somebody that could work in the field and get things done, and kind of remove myself from that piece as much as possible as quickly as possible once we got to a certain point. So when we hired him, we were really ready for him. But he really wasn’t ready for us because he had ideas about doing his own thing at the same time. And I really, really should have hired the person as opposed to the experience.
So we corrected that by hiring Oscar, who was the person. He didn’t have any experience in house flipping other than installing granite, right? So he was a foreman and he managed other people before, but he had never managed multiple subcontractors. But it turned out to be okay because the best thing about Oscar is his trustworthiness, his ability to adapt, and to be able to deal with me, right? So he’s working for a boss that used to do everything himself who may have a tendency to be a little bit of a micromanager. So, you know, I’ve had to train myself not to be a micromanager and let people do their job. And, you know, if I had somebody with a different personality that was maybe a little more headstrong, like me, it probably wouldn’t work.
So I think whatever the position is, personality is huge. I mean, Patty, our office manager, we did have her do DiSC test, and we had multiple applicants for that position. In fact, my lead manager applied to that position originally, and I didn’t like her DiSC test for that position, so we ended up offering her a lead manager position later, which we thought was going to work out and it worked out for a while, but I don’t want to, you know, beat on that horse too much.
Mike: Yeah. Yeah. So you think it’s better to try to find somebody . . . cultural fit, obviously, is a big one. Some of the tasks, some of the responsibilities can certainly be learned, right? And then, just somebody that just has a good work ethic and maybe a good athlete, right?
Bob: Work ethic, absolutely, 100%. A quick story on that, Oscar and I had a situation back in March. We had a house that was on the market that was scheduled to close in two weeks. And it was about 45 minutes away from my house and an hour away from Oscar’s house. We got a phone call on a Sunday afternoon that a pipe had burst one of the . . . actually, the buyer went by the show his parents the house, when he opened the front door, there’s two inches of water on the ground.
So I jumped in my truck and I called Oscar, you know, it was Sunday evening, and he was having dinner with his family. He went to our storage unit, grabbed a bunch of fans and a bunch of tools and equipment, and he and I went up there and, you know, we found a huge mess. This house had a basement that we just finished. So he and I tore it apart, spent about six hours taking it apart. Everything worked out in the end on this house. People still bought the house, so I’ll leave that part of it out. But it was a freaking nightmare when it was happening, right?
But the lesson was the thing that sticks with me on this story is we were driving home at about 11:00 at night and I was on the phone with Oscar and I told him I was going to pull into the gas station. And Oscar has a company credit card and he also has gas points from one of our local grocery stores that he uses a lot. When we buy Home Depot gift cards from our grocery store, we get free gas, right? So I told Oscar, “Hey, pull in behind me and we’ll use my card so you can save your points.” And he said, “No, no, no. I do need gas, but I have to buy it.” And I said, “What do you mean you have to buy it?” He said, “Well, you let me take the truck home, so I’ve been putting a tank of gas in once a week on Sundays, and today is my day to fill up the tank, so I’m taking care of it.” Which was, you know, what does that tell you? The guy is 100% trustworthy.
Mike: Yeah. Yeah.
Bob: And here he is working at 11:00 on a weekend night and he’s still willing to go put his own money in the gas tank.
Mike: Yeah, that’s awesome. That’s awesome.
Bob: So if you could, yeah, if you can find somebody like that, with that kind of work ethic, I think that goes a long way.
Mike: No doubt, no doubt. Bob, you’ve been in Investor Fuel for a little while now and I know you value, you know, kind of getting around other people that are on this growth path too, right? And I guess kind of what we’ve just talked about work ethic. It’s kind of funny, we’ve talked about this in the last couple of shows we’ve done, but we’re an unusual breed, right? Like we’re willing to work hard and take on a bunch of risk, perceived risk, at least, to do these things to kind of improve our life. And what has that kind of meant to you to be around other people like you that are inside of the Investor Fuel family, just kind of being on the inside?
Bob: Yeah, it’s huge. Mike, I mean, you’re in a room for three, four days with people that are going through the same wins and losses that you are. And you know, when you spend time like I did working on your KPIs, the day before the meeting, and maybe you’re beating yourself up for a couple of things, and then you walk into the meeting, the first thing you see is, you know, Hannah, with her big smiling face, and a bag of goodies for you, right? And then you go up to the room and you see Mike and Stinson and all your friends that you’ve met at the meetings, and then you see some new people. You can pick them out because they have a different color of lanyard, right? So you spend time just talking and getting to know people, and it just lifts you right back up to where you want to be and where you needed to be.
And then, you start to hear people talk and you’re thinking, “Yeah, I know about that.” And then you or Stinson will pass the microphone over and you catch the microphone, and you can give them a situation that totally relates to what they’re going through at the moment or somebody else across the room will say, you know, “I use this system to solve that problem. And you jot down a note, and you come away with, you know, information, but you come away with like, I’m ready to roll. These are my people. They understand what I’m going through. They understand where I’m headed, and they’re helping me get there. So it’s huge.
Mike: Yeah, and I think you’d probably agree, there’s so much power. I mean, they’re my own events and I’m, like, totally inspired there just by the information sharing, right? I mean, I’ve been coaching for 10 or 11 years, this is not coaching. This is like peer-to-peer, like, “That’s happened to me. Here’s how I dealt with it type of stuff.” Usually, people that are willing to, you know, I don’t know that many people in our group hold back, right? They usually just whatever you need, whatever you’re asking is right now, like, I’m going to share that with you.” There’s a lot of power in having access to knowledge at that level, right?
Bob: Absolutely. And, you know, not just the sharing one at a time one-on-one conversations, but then when you put together the panels, I like those. Probably the most out of the meetings, when we’re there, because you’ll have about four people there at a time, and those people are sharing their knowledge on specific topics. But then it opens up conversation in the entire room, which is huge.
And I’ll tell you something else that I get the most out of the meeting from is setting our goals. So I have been in other masterminds, but this is the only one that I’ve ever participated in that actually makes you take the time to think about some goals and leave there with four things that you’re going to work on, right? And not just four things that you’re going to work on, but I caught myself scratching out my four goals and focusing in a little bit deeper on making my goals, so “What is it going to take to accomplish that goal?” So when you leave there, you usually leave with a plan.
And then the other cool thing is we have these accountability partners, right? And we have accountability calls. So it’s not like you’re just going to a mastermind a couple of times a year and getting all jacked up and going home and forgetting about it. You’re going to the mastermind, you’re getting all jacked up, you’re making new friends, and then you’re going home and you’re going to work. And then, once a month, you’re hopping on the computer or the phone with your friends and they’re saying, “How are you doing with that goal of implementing Lead Sherpa? What’s going on with your Sherpa, etc.?”
Bob: So, yeah, it’s awesome.
Mike: That’s great. What advice would you give to people that are . . . because how long have you been a real estate investor for, Bob, like, I guess full-time?”
Bob: Yeah, full-time real estate investor five years. Prior to that, it was a side hustle and did four to six properties a year for five years before that.
Bob: And I started with rentals back in ’03, but full-time, main focus on growing and rehabbing business for the last five years.
Mike: Okay, and what advice would you give to people that are listening right now that are doing some deals already, but they’re looking to kind of grow? You know, you’ve had some wins, you’ve had some losses? The truth is we all do as entrepreneurs. You know, it’s easy to tell on social media, or even on podcasts sometimes, people get on and talk about the good stuff. I mean, the reality is, it’s the bad stuff that makes the good stuff work, right? You have to kind of go through those iterations of failing and having issues to make you stronger. But what’s the kind of, I guess, maybe the number one piece of advice you could give to somebody that is doing some deals already, but they’re looking to kind of grow as you have?
Bob: I gave this advice to someone yesterday. I had a new wholesaler call me. I’ve been working with this guy for about a month-and-a-half now. He’s, I don’t want to say I’m mentoring him, but I’m helping him out. And he’s been calling me asking me questions, etc. So he’s had, this will be the third deal now he’s put in front of me that I’ve passed on. But I went out to this house and it was the most promising deal that he’s showed me so far. And I was there and I said, “Look, I just put a house under contract yesterday. I’m putting another one under contract tomorrow, and I’ve got five rehabs going right now, so the next deal I do is probably going to be a wholesale deal. If you want a joint venture, wholesale this, I’ve got some guys that I know would buy this house.” And he said, “You know, I think I’d rather just see what I can do on my own.” And I said, “All right. That’s cool. Let me know if you change your mind, or if it doesn’t work out, give me a call.” Because I was kind of done with the guy, you know, at this point.
And I left and he called me back. And he and he asked me another random question just to get me talking to him again. And I said, “You know, I’ll offer you some advice on this, whether you do this with me or with somebody else. I mean, this is your first legitimate wholesale opportunity. You have a real opportunity in front of you. And I know you’re looking at the dollars and the return on it, and you can make more money doing this by yourself, and you probably will, and you’ll figure some things out. But if you want to figure this out a lot quicker and do deals, you’ll find a partner, somebody who’s done this before, somebody that has a title company to work with, somebody that, actually, knows how to maneuver through this wholesale process. And whether you work with me or somebody else, you should find somebody else and let them bring you along on this journey, and learn how to do two or three deals before you go out on your own.”
And that’s the way I learned. I had a partner, a guy by the name of John McCalla, out of the Baltimore market who helped me many years ago on my first three wholesale deals. And we worked together and he held my hand and we got it done. And, you know, no turning back after that.”
Mike: So your advice is to kind of get a mentor or have somebody show you the way?
Bob: Absolutely. First piece of advice is find somebody that’s doing what you are doing or want to do better and have them teach you, have them help you and then take the training wheels off and make it happen.
Mike: That’s great. That’s great. Bob, if folks wanted to, I know you’re starting to do more videos on social media and some other things. So if folks wanted to get in touch with you or reach out to you or connect with you one way or another, where should they go?
Bob: Sure. Facebook or Instagram, Bob Allwein, A-L-L-W-E-I-N, or if you can remember this, Bob The Flipper on Facebook, and then you’ll find my other business my Maryland Cash House Buyers on Facebook, or Bob Allwein on Facebook. You know, I share my posts back and forth from each of those sites. So yeah, just look me up on Facebook or Instagram.
Mike: Well, we’ll definitely add links down below in the show notes for all these things. So, Bob, I appreciate you joining today.
Bob: Thanks, Mike.
Mike: Yeah. and everybody, if you’re listening right now, we just started the podcast here real recently. We would love it if you would subscribe, give us some reviews, share this with other people that you care about that you think might get some value out of it. As when you start a new podcast, for those of you that don’t know, early on the ratings, reviews, all those things are absolutely critical to people actually seeing this when you start to get some traction and people are saying that they like it when you’re new, you kind of show up a lot more for people that are looking for deals like this. So we’d really love it if you’d give us a little bit of love. Also, you can always subscribe to us on iTunes, Stitcher Radio, Google Play, YouTube. Of course, you can watch everything on flipnerd.com, as well. So thanks for joining us for another episode. We’re going to keep them coming your way. Bob, thanks again for being with us.
Bob: My pleasure, Mike. Thank you.
Mike: Always good to see you. And everybody, until the next episode, stay focused on what fuels you see. We’ll see you then.
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