Scale Like an Airline: Systems, Checklists, and Leverage for Real Estate Investors

Steve Rozenberg (00:00)
And the biggest challenge when I talk to real estate investors, when I ask what do you do? They tell me I’m a flipper. I’m a wholesaler. No, you’re a business owner. The subsection of that business just happens to be real estate. And the tactic that you are using is flipping, burr, short-term, long-term. Don’t identify as that because that’s all you’ll ever be.

Michelle Kesil (01:54)
Hey, everybody. Welcome to the Real Estate Pros Podcast. I’m your host, Michelle Kesil. And today I’m joined by someone I’m looking forward to chatting with, Steve Rozenberg, who’s been a real estate professional for 25 years and is now coaching real estate professionals to scale their businesses. So excited to have you here today, Steve.

Steve Rozenberg (02:17)
Hey, thanks for having me, I appreciate it.

Michelle Kesil (02:19)
Of course, let’s dive in. First off, those not familiar with you and your work yet, can you share what your main focus is these days?

Steve Rozenberg (02:28)
Yeah, these days is all about helping people. ⁓ I do a lot of business coaching. ⁓ A lot of it with solutions in mind, meaning ⁓ trying to help people figure out how they can grow and scale their business and what tools they need to grow and scale their business. ⁓ most of time it’s a mental side. They need the mental mindset to become a different person, to scale a business they’ve never had. ⁓ So that’s probably the main thing.

⁓ I think a lot of times people get caught up in the identity of what they do, not who they’re trying to become and what they’re trying to create. So it’s really getting people to unlearn ⁓ some bad habits, I guess we’d say.

Michelle Kesil (03:13)
Yeah, definitely. And how did you get into the coaching aspect of your business?

Steve Rozenberg (03:20)
Well, I started investing in real estate after 2001 when I was getting furloughed as an airline pilot at the time. And I started buying real estate and like probably many people made a lot of mistakes, lost a lot of money from people that like to say they would do one thing and they would do something else. Ended up owning some apartment complexes as well as a lot of houses.

Me and my business partner, excuse me. Me and my business partner, we started a property management company here in Houston, Texas. And ⁓ we ended up scaling that to over thousand properties. It was the fastest growing company in the state of Texas at one point. We’re in three major cities with 60 % of our company was outsourced to Mexico with virtual assistants. ⁓ We got so good at virtual assistants that we actually went

and started our own company down there for placement services. ⁓ We eventually ended up selling our company to a venture capital firm. They had over 10,000 properties. I ended up becoming a vice president for them. And when I was done, I just had a lot of people approaching me, asking me, how did I do it? And the way we did it is I essentially learned how to run my business the way an airline runs.

processes, systems, checklists, all the things that make airlines all over the world 24 hours a day, seven days a week, every second, be safe, secure and on time. I basically put that into our company.

Once I was done with that, I started doing works with companies like Bigger Pockets and other organizations. I got to know a lot of people from those organizations, ⁓ big, we’ll say names that probably most people know. I became very good friends with a lot of them.

started coaching a lot of them. And then it just trickled down to me helping people because people said, Hey, could you show me how to grow my business the same way? And it’s a recipe like baking a cake. There’s a recipe driving your car. There’s a recipe building a successful business. Doesn’t matter what it is. There is a recipe. And so I just follow the recipe.

Michelle Kesil (06:27)
And what are some of the main keys that have allowed your business to grow and run successfully and that you now support others in implementing?

Steve Rozenberg (06:38)
Yeah, I would say the first thing, ⁓ the biggest mistake that people make ⁓ in this is they don’t start with the end in mind. You’ve always got to start with the end in mind and you reverse engineer it from there, right? So what does the business look like when it is a finished product? Most people can’t even answer that. My answer is then you shouldn’t start because you would never get in an airplane, take off and then figure out where you want to fly to.

You don’t know how much fuel you have. You don’t know the routing. You don’t know the weather. You don’t have any emergencies. You would never do that. As a matter of fact, even when you get in your car and you use Google Maps, Google Maps has to have two things. They’ve got to have a start and they have to have a destination. If you don’t give it those two things, Google Maps cannot give you a strategy to reach there. So you wouldn’t get in your car and drive that way. You wouldn’t just get in your car and start driving thinking you’re going to get somewhere. You wouldn’t get in an airplane.

But most people would start their business and run their lives for years and years and years and they don’t even know where they’re going. So how can they tell me they’ve gotten somewhere if they don’t even know what that destination is? So the first thing I show people is where are we going? What is that destination? What does it look like? Because that is the most important thing. And then what systems, what structure, what tools do we need to get you there? Because you’re not going to do it on your own.

The hardest work in the room is not the most successful. They’re the most tired, but they’re not the most successful. The one who understands leverage, leveraging time, leveraging money, leveraging systems, leveraging people, leveraging knowledge. That’s the people that are successful. so understanding the power of leverage is the most vital thing. So that’s what I help people with a lot.

Michelle Kesil (08:29)
Yeah, and what are some of the key systems that you think any business owner should have implemented?

Steve Rozenberg (08:40)
Well, I think the first thing they need to do is they need to learn how to make money. ⁓ communicators, salespeople are the highest paid people on the planet. Most people have a revenue problem in their business because they don’t know how to make revenue. They don’t know how to communicate with people. They don’t know how to sell. They don’t know how to close. They don’t even know how to handle situations. Whether, if you’re a real estate investor, whether that’s dealing with a tenant, whether that’s buying a property, selling a property, dealing with a contractor, that’s all communication.

Michelle Kesil (08:44)
Mm-hmm.

Steve Rozenberg (09:10)
That’s the number one thing they need to learn how to make money. Most people that are not making enough money, they need to learn how to make more money. I mean, that’s the answer. They think it’s something fancy, but it’s not. The other thing they need is they need a solution of some sort of mechanism, like a CRM system to be able to make them money 24 hours a day, seven days a week after they capture that lead. So, you know, I ask people, how much money do you think you’ve lost by not following up with people?

ASAP by not having a drip campaign that goes out to someone for two years by not being able to have mechanisms and metrics to know your client acquisition cost your cost per lead cost per strategy. No one knows that. So how do you even know you’re making money just because you got you’d flip the property and you got money in your bank account. That doesn’t mean anything. What is your time worth?

So there’s a I I wish I could say it was one thing. It’s probably not one thing. It’s a multiple amount of things.

But it starts with understanding what is that person’s strength and what is their weaknesses. I believe you play to your strengths and you outsource your weaknesses. And most people don’t. They try to do it all and they pretty much suck at all of it at once. You’re good at one thing. That’s what you should focus on. Outsource everything else.

Michelle Kesil (11:05)
Yeah. And for those that are investors, is there something specific that you think they often miss the mark on?

Steve Rozenberg (11:14)
I was talking about investors actually. But I think the biggest thing is, they can’t quantify success. If I ask people, what is success to you? They may say, oh, you know, a hundred thousand dollar flip. Well, that’s just money. You’re making that money for what? Most of the time we get involved in real estate because we don’t like the life we had and we want a life that we want to have.

Michelle Kesil (11:16)
Right?

Steve Rozenberg (11:44)
And we think real estate can be that vehicle. But when I ask people, how’s that working for you? They can’t give me an answer because they can’t quantify it. They don’t even know what success is. Success is not a revenue number. It’s what you do with that revenue to go enjoy your life. So I work with entrepreneurs all over the world, real estate investors, property managers, contractors, trades. That is just what they do. It’s not who they are.

And the biggest challenge when I talk to real estate investors, when I ask what do you do? They tell me I’m a flipper. I’m a wholesaler. No, you’re a business owner. The subsection of that business just happens to be real estate. And the tactic that you are using is flipping, burr, short-term, long-term. Don’t identify as that because that’s all you’ll ever be.

And when that tactic is over, for example, if I wanted to go skiing in the mountains in Colorado,

in the winter time, I’d use snow skis. But if I wanted to ski in the summertime, I would have to use water skis, which means I have to change tactics. So there was a certain time that flipping was a great tactic. Maybe that tactics over. Then burr was a great tactic. That tactics over. So it’s a matter of understanding that tactics are just tools. You use it and then you put it away for another day when you need it. Don’t be the hammer.

Use the hammer as the tool when you need to pound a nail on the wall. Does that make sense?

Michelle Kesil (13:19)
Yeah, absolutely. And you mentioned that mental barriers are one of the biggest blocks that you support people with. What are some of the top mental barriers or limiting beliefs that you find investors struggle with?

Steve Rozenberg (13:34)
⁓ I think a lot of it is, is imposter syndrome. You know, they walk into a room and someone’s talking about how they have a, you know, 5,000 units of apartment complexes and they’re like, God, I just do houses. Maybe I should get into apartment complexes. And when I ask why they really can’t give me an answer. ⁓ they just think, well, that’s, that’s, that’s where the money is. ⁓ it’s also lost. You know, I’ve, I’ve been in some deals that have lost money. I’ve, I’ve lost money in deals recently. ⁓ but it’s fine. It’s, it’s a sandbox we play in.

I think where a lot of people struggle is they can’t quantify what, and I go back to success, they can’t tell me what success is. So they can’t tell me if what they’re doing is right or wrong based on their goals. And so a lot of times they really need to sit back and ask, why are you doing this? Why are you spending all this time away from your family and loved ones doing all this for no money? mean, the average real estate investor does not make a lot of money when they factor in how much time

stress, headache, they’re putting into a deal. At the end, they go, I got to check for a hundred thousand dollars. But all the work that you put into this, it’s, and then paying everyone and interest and all, it’s not that much. The person who knows how to leverage and be able to have multiple businesses going, that’s the successful one. And the biggest thing is someone taught this to me a long time ago. I am not my business. My business is not me.

I’m not my business. My business is not me. Meaning anything that happens in my business. If I, if I sell a property and make $300,000, I should not get super excited because if that’s the case, what happens the next time I lose $300,000? I’m going to be in the dumps and sad has nothing to do with you. It’s just part of the business. It’s just zeros. So it’s hard, but stop associating yourself.

with what you do.

Michelle Kesil (16:18)
Yeah, absolutely. And how do you support people in overcoming these mental blocks?

Steve Rozenberg (16:25)
Well, I think first it’s really understanding why are they doing this? You know, why real estate? What is it they want? And disassociating them from what they’re doing to who they are and understanding if they’re doing this for their family, tell me about that.

I talk, I get the opportunity to speak all over the world. A lot of conferences, events, I coach a lot of people, masterminds. And one of the questions I always ask people is, why are you doing this? And what’s the standard answer? I’m doing this for my family. I’m doing this for my loved ones. I’m doing this to have more time. Okay. Question two. If I grab your phone right now and call your spouse or your kids,

Will they tell me that they are reaping the rewards of everything that you just told me? well, no, so then you’re lying. So either you’re lying to me now or you’re lying to your family because you’re not doing it for them. Because if you were, it doesn’t take money to go spend time with your family. It takes attention. And you’re not giving them the attention. So you’re lying. You don’t need to go on an expensive cruise. You could go to the park, right? Kids spell love. T. I. E.

They don’t need that. That’s your ego talking. So then I ask, why are you doing this? And they don’t know. They really don’t know. Like, I think you should think about that and figure that out before you do anything else. Like you gotta have your destination. Just like Google Maps, you gotta have that destination.

Michelle Kesil (18:01)
Absolutely. And so when someone works with you, are they kind of uncovering these core desires of their and then, you know, creating a business that will support them in landing to that desire?

Steve Rozenberg (18:18)
Listen, you know, everyone’s different, right? Humans are very interesting creatures, right? We have different wants, desires, needs. ⁓ Some people, you know, want self-assured. Some people want fame. ⁓ Some people want their ego stroked. Everybody wants something different. ⁓ My job is not to be your psych, your therapist, right? I’m not here to give you, you know, therapy. I’m here to solve your problems. I need to know where you want to go to see what your problems are to give you solutions.

So when I solve your problems, again, is it that you need to learn how to make more money? Is it that you need a virtual assistant? Is it that you need a solution for a CRM mechanism, financial accounting? What do you need? Not many people want to go sit and have therapy, and I’m not a therapist. I’m a solutions expert. I give you solutions to your problems. But first, we got to have a real honest discussion about what is the problem? Because I don’t want to give you the solution to the wrong problem.

And so understanding where you want to go and then reverse engineering and seeing, okay, what are we missing? Where are the gaps? Once we see the gaps, we can fill the gap. So I guess kind of another question that you asked, clarity. Help giving them clarity as to what they want starts bridging the gaps of where we need to fill in.

Michelle Kesil (19:43)
Absolutely. And what do you feel are some of the main ⁓ blocks that people have in scaling to that next level?

Steve Rozenberg (19:57)
1000 % between their ears. It’s their own, it’s their own limiting beliefs. That’s exactly what it is. It’s, I wish I could say it was the environment. It’s the economy. None of those things are true. Those are the, that’s the lies we tell ourselves to make ourselves feel better. It’s if you want to build, right? So when you, when you own a business, I don’t care if it’s real estate, pizza, dry cleaning, Chevrolet, Frito-Lay, doesn’t matter. You’re doing a business to create revenue.

Michelle Kesil (20:03)
Mm-hmm.

Steve Rozenberg (20:25)
that revenue has to have a certain amount of profit margin and that profit margin gives you the ability to go with your family to create memories and spend time with your loved ones. At the end of the day, every entrepreneur is just trying to create memories. That’s all we’re all trying to do. We’re using money as that mechanism, right? And so the biggest challenge that most people have is they don’t even they’re so far off.

We got to kind of get them to say, who do you need to become? Because if you say, I want to build a $50 million portfolio that is, ⁓ giving me a million dollars a year of, of revenue and of that million dollars, I’m making 15 % margin. Okay. Great. Who do you need to become to build that business? Because the person you are today is not going to build a $10 million portfolio because if you knew how to do it,

You’d already be there. So you’re missing something. So I’m the one that asks the tough questions of who do you need to become? And a lot of times, Michelle, it’s who do you need to stop being? What do you need to let go in life to become this new person? Because if you were able to be that person, like you’ve never built a business that big before, how do you know how to do it? You don’t, most people don’t even know what roadblocks are coming their way.

not because they’re ignorant, not because they’re lazy, but because they just have never done it before. They just don’t have the map. And so what I do is I provide the map, but I have to first see where is it that you want to go before I give you directions.

Michelle Kesil (22:11)
Yeah, definitely. And how did you uncover this for yourself?

Steve Rozenberg (22:17)
A lot of mistakes, a lot of trial and error. Uh, I, I’ve probably lost more money than many have made in their life and that’s okay. Um, and it’s not easy. It is not easy, but the one thing I know is that no matter how much I suck tomorrow is a new day and I get to set restart tomorrow and I get to do it again. And so the biggest thing I’ve learned is the identity that nobody cares. Nobody cares if I make a mistake.

Nobody cares if I make money and nobody cares if I lose money. Nobody cares. I have to care more than anyone else. And so it’s that ego and pride that if I did something and lost money on, nobody cares. Now, if somebody gave me money and I lost there, they’re going to care, obviously, but in general, we are our biggest critics. We, we tend to not do anything because we’re afraid on how we’re going to perceived, but nobody cares.

Nobody cares. And so that’s a hard thing to learn. You know, we think we’re more important than we really are, to be honest.

Michelle Kesil (23:23)
Yeah, absolutely. Thank you for sharing. And before we begin to wrap up here, if someone wants to reach out, connect, and learn more about everything you’re up to, where can people find you?

Steve Rozenberg (23:37)
They can go to my website. It’s steverozenberg.com. So it’s r-o-z-e-n-b-e-r-g dot com. They can follow me on, you know, I’m on all the social media, YouTube, Instagram, Facebook, all the standard places. If you Google my name, r-o-z-e-n-b-e-r-g, you will find me and you will be able to get a hold of me.

Michelle Kesil (23:58)
Perfect, we’ll appreciate your time and your story. Thank you so much for being here.

Steve Rozenberg (24:03)
My pleasure, thank you.

Michelle Kesil (24:04)
Of course, and for those tuning into the show, if you got value, make sure you have subscribed. We’ve got more conversations with operators like Steve who are building real businesses and we’ll see you on our next episode.