Innovative Strategies in Real Estate Wholesaling

Dylan Silver (00:01.314)
Hey folks, welcome back to the show. I’m your host, Dylan Silver. And today on the show, have Thomas Scott in beautiful St. Petersburg, Florida. Thomas, welcome to the show.

Thomas Scott (00:14.436)
Thanks for having me. Super stoked. Thanks again.

Dylan Silver (00:18.112)
Absolutely. Let’s start off at the top. How did you get into the real estate space?

Thomas Scott (00:24.804)
Wow, well I know only have 20 minutes, so I’ll keep it really brief. Well, I owned a video production company for over a decade in Pensacola, video production, video marketing, and we moved to St. Pete to grow that business, and about two years in, we got a really unique gig where we were hired to film a two-day seminar.

There’s a gentleman named Raphael Vargas. I don’t know if that rings a bell, but he was a young buck out of Tampa. He was doing like 10 million a year. And so he was teaching people how to wholesale virtually. And so people were flying all over the world to come see this seminar paying 25, 30 grand just to have them open up the curtain, show them how to do it. And I had no idea about what wholesaling was. And I’ll just…

be frank here after it was all done, I was like, man, there’s something missing. I thought real estate investing was a lot different and just didn’t realize that there were other methods of really getting into real estate. And so there was a little seed that was planted and let’s just say COVID kicked in and my business kind of had the rug pulled out from it. We had a pivot and I’ve always wanted to get into real estate and investing and building wealth.

And that little seed just kept growing. And long story short, I had to make some move and adapt. I had a family and we needed to get some revenue coming in, right? And so ended up becoming a Dispo Manager at a well-known company in Tampa. And that’s how I got my start and the rest is history.

Dylan Silver (02:04.056)
That’s how I got my start too.

Thomas Scott (02:06.552)
Nice.

Dylan Silver (02:07.886)
So I was selling cars working for a Nissan dealership in San Antonio. And if you’ve sold cars before, know people who sell cars, in many cases, you live there. It’s all of your time, quite literally. You get one day off, at least I did, and it’s all of your time. And so I started to see, and this is kind of the trend in that industry, that they’re really shifting from a model where you need salespeople to a model where you pretty much just

Thomas Scott (02:19.683)
Yes.

Dylan Silver (02:37.214)
order your vehicle and there’s more of that and more people want to do that and are educated on that. And so as I was seeing that and I kind of saw the ability for the average salesperson to make a living going in a different direction, I started to look at alternatives and real estate was something I was always interested in, but didn’t have the friends didn’t have the network of people involved in real estate. So was like, well, how do I get in? And much like yourself, Thomas, I found the company

that took a shot on me and I ended up first starting as acquisitions in San Antonio, then ended up moving to both acquisitions and dispositions in the greater area. And now here I am two years later and I’ve got my real estate license in Dallas. I’ve done 20 plus wholesale deals. This podcast is just crazy how these things shake out.

Thomas Scott (03:32.088)
Life is trip, A lot of people look at that COVID situation. Now, granted, it was pretty bad for people, but it really was kind of a blessing in disguise for us. I did pretty well in the video world, had opportunity to work with some of the biggest names on the planet, and had a great ride, but it didn’t really get to where I was now as far as the financial freedom.

You know, I work from home. My family is, we’re all here. We homeschool my kids. And so it gave us a really, a unique, you know, approach to making money, helping people and having this rich lifestyle where I’m able to focus on my family, focus on the children, really build, you know, a bond with them. Cause as you know, most of these kids are gone at school eight hours of the day. And so we’re really blessed, really blessed for sure.

Dylan Silver (04:28.246)
I feel like when we were growing up, we hardly knew our parents to some degree. Do you feel that way?

Thomas Scott (04:32.227)
Well, I was a product of the 80s. So yeah, my parents would be working and you know, we were off in woods riding bikes, just exploring the world, right? But yeah, I think it was twofold. You know, they were gone, we were gone, but definitely a different world now, you when we look at it, especially my life from how I lived, you know, as a kid. I had three brothers, so we’re all always running around.

Dylan Silver (05:01.934)
Thomas, how does your wholesale business look today?

Thomas Scott (05:07.214)
Good question. Over the last five years, there’s been iterations to kind of reflect on what happened next, right? So I started the Dispo job. Three months in, they decided to shift gears and went into tech business and started a CRM company and let go of everybody. So I’m like, well, what do wanna do? And by this point, you I’m an entrepreneur. I just like to dive in and I had a background in tech and automation.

And I said, you know, what the hell at this point, I had a, um, a really big buyers list that they helped build and I was building at the time. So I said, you know, I’m just going to go out and try to get this done. And so the first year at no experience in real estate, other than, you know, the three months I learned there and, uh, I made, you know, over six figures, I ended up doing about 40 transactions and all I did was leverage other wholesalers deals. Right. I spent $0 on marketing.

Dylan Silver (06:00.494)
Holy s-

Thomas Scott (06:07.332)
And so it was, at this time the market, you know, COVID kicked in, the markets were a little wonky, but then all of sudden, especially here in Tampa, St. Pete area, things started heating up. I mean, you could sell a dog house and make some money on it, right? So the second year I ended up growing three times that, did around the same 35, 40 transactions and started to have more control of my marketing. I didn’t want to depend on other wholesalers and the whole…

you know, daisy chain world. And so I said, you know, let me go ahead and just start testing, doing marketing. So started putting fuel on the fire with, with the channels that were working. And from there, I ended up creating a unique business model, the wholesale world. As you know, it’s pretty much the same, right? They, they market, get things, properties under contract. Then they market it to their buyers list. They get all these guys to go to the property.

give me your highest and best and hopefully I’m going to close the deal, make some money and make this seller happy, right? I just didn’t really like that model. And so what I did is I found a handful of guys that I’d already done deals with, built some trust, had some credibility with them. And I said, Hey, look, I’ve been doing some marketing. It’s working really well for me, but I want to scale and grow to other markets. Right. And so I said, here’s my proposal. Why don’t you fund the marketing campaign?

Okay, I’ll manage it. I’ll handle all the leads that come in. I’ll do the do the acquisition. So negotiate. I’ll set up all the appointments and even dispo if I need to and act as a as a transaction coordinator. So essentially what these guys were getting was a whole real estate company in a box. And now they didn’t have to depend on wholesalers. They didn’t have to depend on agents. They didn’t have to pin on auctions, fizz bows, all the things that you know,

these guys do, right? And so now they had control of a lead funnel, a lead system that they were able to control. And when you control your lead flow, you control your project flow and your revenue. So fast forward, ended up doing over 150 deals now in my four years, moving into five years, and started to actually deploy AI. And I know we’re gonna talk about that. But right now, the beautiful thing is,

Thomas Scott (08:30.008)
We do less deals, make more money simply because of all of the ways we now know how to convert leads, right? From cash offers to novations to sub to creative deals. I’m a land acquisition expert as well. So I entitle land. So any way that I can look at a deal, look at what’s ideal for a seller and help them, you know, that’s what we do. So that’s it, man. I know it’s probably something you probably weren’t expecting, but

It is definitely a unique model and I’d love to share a little bit more about that if we have time as well.

Dylan Silver (09:05.696)
You inspire me, Thomas. I’m trying to get to where you are. I think you said something like 140 deals in four or five years. I’m trying to get to where you are. And the approach that you have, two things that really stuck out to me. I consider myself to be like a networking junkie, but I also consider myself to be like a real estate junkie. So as a realtor in DFW, I look at things.

Thomas Scott (09:07.492)
wow.

Dylan Silver (09:29.57)
differently than every other realtor. And I also think I look at things differently than every other wholesaler because I like to combine the wholesale aspect from an investor standpoint, how to market and find the distressed properties, how to find your buyers with the mentality of a realtor, which is like you have to do everything so you are effectively staying in compliance, right? And so that you have the public’s best interest. And sometimes these worlds are competing. But when I hear

someone talk about a strategy like the one that you talked about getting investors to fund your marketing campaigns. But it’s in their best interest, too, because they’re going to have to pay somebody and they’re not going to be effectively in-house. So they’re just going to pay assignment fees. Right. And there could be double closings and so on and so forth. And they don’t actually know how much people are making. Well, with your approach, it’s like, yeah, you are paying me up front. And I am.

doing some legwork that requires some faith, but we’re going to be a team on this here and you’re going to see a much greater return than you would going through to other people.

Thomas Scott (10:38.756)
Yeah, Dylan, and one of the best parts about it is there is no cost, right? We’re actually a partnership. So once they fund the campaign, we essentially, once we get it, there’s a few different ways that we can work it out. But the underlying note here is that they, let’s just say at the end of the day, they’re like, Thomas, we can pay 200 grand for this house, get it done. So we come in and negotiate anything under that 200 we can keep.

So that enables us, they’re happy and we can keep that. Or we want them to get the best return on investment and we partner with them on the backend. So we get anywhere from 15 to 20 % of net profits of the flip. That way we’re incentivized to continue to do a great job and close, because if we don’t close the deals, well, we don’t eat, right? Nobody eats. So it’s a wonderful partnership. We’re all in the same bed, so to speak, trying to get this thing going. And one very powerful

thing they have to recognize about this model is they get the control back. If you’re depending on wholesalers, you’re sifting through all these deals that we know just don’t make sense because you hear it all the time. These wholesalers suck. They don’t know how to evaluate properties and underwrite stuff. They don’t know the costs that are associated with flipping a home and holding costs and taxes and utilities and everything in between, right? So it’s a pretty powerful way for them to actually keep

keep the flow going and not having to depend on that spending the time. And once again, they’re able to control their project pipeline and their revenue.

Dylan Silver (12:16.12)
Yeah, it’s huge for investors. I’ve heard investors talk, I’ve heard them speak about this issue specifically, having to buy deals from wholesalers. I’ve known investors who are willing to lose money to be their own wholesaler versus pay someone else. It doesn’t make sense on paper, but it’s because they just don’t like doing it. You what I’m saying? And so you’re tapping into that. Thomas, I want to ask you, when people come up with new strategies, sometimes

Thomas Scott (12:30.05)
Hahaha.

Dylan Silver (12:44.682)
It’s almost a divine intervention, but I get the sense that this was a very strategic move by you to come up with this strategy. How did you come up with this strategy? And walk me through the thoughts that were going on in your head when you were thinking, I’m going to go to investors and effectively partner with them in my marketing.

Thomas Scott (13:05.72)
Yeah, so I just imagine a hamster wheel and I did not want to be that hamster in it. Right. I like long term relationships. And so when you start to actually build long term relationships and you’re providing a steady source and you’re really becoming integrated into these people’s business and to their company and really driving revenue for them. You’re going to have some friends for a good time. Right. And so.

the once again the old model I saw that the typical traditional wholesale model you gotta jump in that hamster cage all the time right that wheel boom you know you get a new deal now you got to go send it out like so I said how do I just add an immense amount of value how do I become a sticky product you know so they they don’t they can’t get rid of me I’ve now been integrated and now they’re just like we got to have Thomas continue to help us because at the end of the day once again you’re getting a real estate company if you were to go out and hire

a lead manager, hire a dispo, hire acquisition people, hire someone to do marketing for you to manage it. Like it starts to be really expensive plus training, you got to keep them motivated. Like it’s a lot. So the partners that I have run small, they’re not huge, know, network style, you know, companies. They’re smaller. And like you just said, they want to focus on what they love to do. And that’s taking ugly homes and

turning them into something beautiful and making money. And they don’t want to have to do the marketing and everything on the front end. Most of the time they’re just, they’re not that type of personality. You know, they don’t want to talk with these sellers. They don’t want to be cussed out, you know, all the time or whatever. So we fill in a really good gap and that’s how I kind of came up with it. It all comes down to not being in that hamster wheel and building long-term relationships.

Dylan Silver (14:53.794)
Thomas, in hearing you talk about this, it is interesting to me as a wholesaler, but also as an entrepreneur stepping back from this, because for those who are not in real estate, right, or for those who are newcomers, this podcast, we have all different types of people tuning in, right? We have seasoned real estate investors doing a hundred or more deals a year, and we also have people on the outside looking in, trying to figure out how to get into real estate.

The business that you’re involved in and the way that you started it and scaled it is super impressive because not coming from a real estate background, right? You came from a different space entirely having to learn transaction coordination, having to learn acquisition, disposition. I’ll also say that networking with investors to build the kind of relationship that you have, it may be second nature to you or it might not be, but it’s…

Thomas Scott (15:28.612)
Thank you.

Thomas Scott (15:34.636)
yeah.

Dylan Silver (15:48.414)
so many different skill sets and I think people can have a course about each one of those like a networking, transaction coordination, a dispo and acquisitions, right? And then the strategy that you created, super impressive, impressive stuff. I can tell just from that that you have a different way of approaching business and thinking through real estate problems.

Thomas Scott (16:12.932)
Yeah, I appreciate that. Yeah, you know, I’ve been an entrepreneur since I was 22 years old, started my first company. I’m 44 now. you know, entrepreneurs, just, we adapt. I’m also a creative. You know, I played in a reggae rock band and toured the country for over a decade. I’ve put on over 500 events in my time. So I’ve got a lot of world experience being out there in the streets. So they say, you know, being with people, traveling the world.

and you see a lot of different perspectives and I think maybe just my brain was looking at different ways that I could be set myself apart. But also, mean, how smart is that? I don’t have to do marketing anymore. They do the marketing. I get free opportunities. You know, I lean on them for that help and we have a symbiotic relationship and we both, you know, are successful with it. that’s as long as you provide value.

and you can create something that’s sticky, right, that they just can’t let go. That’s super powerful.

Dylan Silver (17:15.256)
super powerful. Speaking of something sticky that you can’t let go, AI is now all over real estate. I’ve really seen it, even in the last 60 days, I’ve seen it ramp up tremendously to the point where right now everyone seems to be talking about speed to lead and that instant feedback that people are getting.

Thomas Scott (17:21.909)
yeah, here we go.

Thomas Scott (17:29.892)
Hmm.

Dylan Silver (17:37.514)
I think that’s huge and I think it’s tremendous. And I think specifically the speed to lead and then the integration into being able to track your data. That’s the new wave for a lot of real estate investors and the people who are super, super, I would say kind of like go as you may just kind of wing it. That’s going to be harder and harder to be super successful doing that.

Thomas Scott (17:37.678)
That’s it.

Thomas Scott (18:03.108)
Yeah, I speak all over on the subject of AI and I’ve been on the forefront of this technology. You you’re just saying you’re starting to realize that more people are talking about it. A year and a half ago, I had a unique situation. As I was telling you, I have multiple marketing partners. Right now, the phone’s starting to ring, but yet I’m wearing many hats as well.

and I’m over here looking at a home, I’m doing a renovation, I’m doing this and that. And so what started happening like most businesses and most investors deal with is they start missing calls. They start not adequately following up, getting back to people on time. Speed to lead is everything, right? If you don’t answer that phone, guess what? They’re onto the next postcard that they got in the mail, right? Believe me, they keep them, they have them. They collect them like baseball cards, you know? And so…

The problem was I was starting to miss calls, was starting to miss opportunities, and this was affecting the whole ecosystem, right? It’s not their fault. They hired me and we partnered so I can handle that. So I was dropping the ball. And I said, well, I need to figure out a better way. And so I saw a video that blew my mind, Dylan. It was the OpenAI video where they were actually chatting with the AI voicebot. And when I saw that, something kind of lit up in me and I said, you know, there’s gotta be a way.

that I can utilize that technology to answer calls, to do that speed delete, to ensure I don’t miss any more opportunities that I follow up adequately. And so my journey began and I started literally globally looking domestically, internationally for a team that could build these systems out. And I’ll tell you after about hundreds of hours of talking to people, researching, and then spending tens and tens of thousands of dollars on companies to help.

consult and try to put these things together. I found a company out of London and we were able to build a system within two months that was able to answer all the inbound calls, any inquiries from website forms. They were getting to them instantly, right? They were able to transfer the call once they were qualified. So we, as an acquisition person, we only want to talk to people that are

Thomas Scott (20:20.856)
have their hand raised, wanna hear an offer and that meet all the criteria, And so it was doing that and then it started the functionality of scheduling appointments right then on the phone, which is insanely powerful. It started doing reminders and then the follow-ups. Not every person you talk to, you’re gonna close the deal, it’s okay. But follow-up is where it’s at. I mean, I’ve had a deal close just, what was it? About a few months ago, it was a $25,000 deal that we had been following up for three years.

They finally came back, right? So having systems and processes in place on the back end with AI totally changed the game. And so a year now and a half using these systems, we save about anywhere from 60 to 80 hours a month. Okay, insane. What would you do if you got 60 to 80 hours of your your month pack like work on?

high level tasks, right? So these were all low level tasks and these are what people are draining their day with right now. And this is how AI is gonna change their world if they allow it. So those who adapt and get in right now are gonna be further ahead of those that don’t. Because just like Kodak, like Blockbuster, the taxi industry, those that don’t innovate.

they’re just gonna die. so AI is that next new wave of opportunity. And so we had so much success in the business. Like last year, we did over a quarter million just with the system alone. And that means like 70 % of the business was automated. We get more deals because we get better lead conversion around a 20 to 30 % boost in conversion because now we don’t have a leaky bucket, right?

all these companies want to throw more money at marketing and leads, more isn’t better. Just better is better, you know, at the end of the day. So having a better system, having a better process of capturing, nurturing, and converting those leads is really where the future is at. And that’s the systems that we deploy in my own business. Now that we’ve taken that unique business model I was telling you about, we kind of ramped it up to 2.0. And now we have AI powered systems along with

Thomas Scott (22:34.454)
seasoned acquisition specialist. So it’s a huge game changer for our own company and our clients. And now we’ve started an AI agency that actually helps real estate professionals leverage AI technology. And we provide this as an additional service as well.

Dylan Silver (22:54.072)
Super cool stuff, man. think here in all, you talk about all these areas, there’s a rooster going off. I’m on a ranch in DFW. I know if you can hear that in the background. But the different ways that you’re innovating your business is something that one person could probably outsource to so many different people, but you’re able to pivot and to adapt and then to make it so that it’s a…

Thomas Scott (23:03.02)
I love it. I love it.

Dylan Silver (23:22.658)
worthwhile not just for yourself but for the people that you’re working with it’s a win-win-win it’s like consecutive stacking when I when I hear people like you talk and talking about your successes it’s just truly remarkable man we are coming up on time here Thomas where can people go to get a hold of you

Thomas Scott (23:37.412)
Thank you.

Thomas Scott (23:41.518)
Yeah, absolutely. And once again, thanks for the opportunity. If anyone’s interested, we have a lot of different ways we can help folks, but they can visit us at www.stellaraisolutions.com and they can go check us out there. You know, if you like what you see or maybe you’re running into the same issues where you’re spending all your time on these low level tasks, like let AI do that, right?

We’ll definitely love to chat with them. We also have a ultimate AI toolbox. So if anyone’s just interested in starting to investigate or want to see the AI tools and platforms that we use, they can reach out to us, you know, go Facebook, Instagram at boom.with.ai and they can get all our handles there as well.

Dylan Silver (24:29.742)
Thank you so much for coming on the show.

Thomas Scott (24:32.696)
Dylan, thank you, appreciate it. Good luck to you guys. Thank you again.