Unlocking Real Estate Success with Matthew Hecker

Matthew Hecker (00:00)
we were just kind of being greedy, trying to flip everything and we were just over consuming deals.

And then you look in your bank account and you have a million dollars worth of loans and you’re trying to support that with maybe $20,000 worth of cash in the bank

And that was that moment where you’re like, this isn’t stable. This is that crash, like grow, and then you’re just going to hit a point where you crash and burn. So it kind of really set our perspective on applying some patience, understanding we can only do what we can do.

Michelle Kesil (02:01)
Hey everyone, welcome to the Investor Fuel podcast. I’m your host, Michelle Kesil And today I’m joined by someone I’ve been looking forward to chatting with, Matthew Hecker, who’s been making serious moves in the investing space. So really glad to have you here with us, Matthew. I think our listeners are really going to take something away from how you’re a

approaching your business working with rentals and Yeah, just all the investments that you and your brother are working on together. So let’s dive in

Matthew Hecker (02:38)
Awesome, thanks for having me.

Michelle Kesil (02:39)
Absolutely. So first off, for people who may not be familiar with you and your world, just give us the short version of what your main focus is these days.

Matthew Hecker (02:51)
Yeah, so we’re, I’m sure a lot of people have heard of wholesalers and so forth, we take a direct to seller approach to finding off market deals. And then we’ll either flip them, turn them into rentals, or wholesale them.

Michelle Kesil (03:05)
and what markets are you operating in?

Matthew Hecker (03:08)
So we’re in the Hampton Roads, that’s like southeast Virginia right on the border of North Carolina. Norfolk, Portsmouth, Chesapeake, Virginia Beach, Suffolk, Hampton, Newport News.

Michelle Kesil (03:18)
Cool. Love it. So how did you get started in this business? What’s your story?

Matthew Hecker (03:23)
So we’ve been flipping for about 10 years now. It’s kind of a funny story. We started buying off the MLS, heard about flipping, saw it was pretty lucrative. Times were a lot different back then. And then, yeah, as the market started changing, we started buying from wholesalers. And actually, we thought wholesalers typically made like $5,000 to $10,000 a deal. So we kind of knew about it, but never really wanted to step into that.

part of the operation or add that to our process, right? So then we bought a deal from a wholesaler, notice you double closed it. Never knew what that was, but I just kinda knew like, why do buy it and sell it? So we looked on the tax database and I told my brother, said, man, this guy made $55,000. And that kinda flipped the switch. were like, wait a second.

there’s more than five or $10,000 a deal in wholesaling, or that side of the business, at least going direct to sellers. So once we realized that, we started diving in for a couple months and then just took the leap on the direct to seller approach. And we’ve been doing that ever since. We’ve only bought two deals, I think, from wholesalers in the last five years. That was five years ago when we stepped into buying our own deals.

And then we’ve even applied that approach to purchasing our first mobile home park, which we acquired earlier this year.

Michelle Kesil (04:44)
Cool, can you expand on the mobile home park? Like how did that process go?

Matthew Hecker (04:48)
Yes, so we’ve got a buddy who’s in the multi-family space. He saw what we were doing direct to seller. He wanted to break off on his own. he was currently working for a company and they’re doing like $50 million plus deals. So we said, yeah, sure. Let’s try it.

⁓ And we, you know, we, we figured it would be a good fit cause he has commercial real estate experience and

We just, we actually started with multi-families. We were calling sellers or owners and one guy said, man, I’ve got a mobile home park. I don’t want to sell the multi-family stuff. And then again, we kind of started looking into that. We started checking with some people we knew that had mobile home parks and that deal didn’t end up going through, but we found another deal direct to seller, 50 units. And that deal ended up going through. So it was just kind of like,

You see a new opportunity, you pivot, and then you’re like, man, and then another opportunity presented itself, and you’re like, yeah, this seems lucrative. It seems like it’s worth going after, and kind of just one foot in front of the other. And that’s how we ended up with a mobile home part.

Michelle Kesil (06:42)
That’s exciting. Cool. So what has been your key to keeping your business running smoothly with all the moving parts?

Matthew Hecker (06:43)
It is.

One I’ve got a partner. It’s my brother. I know that’s not necessarily a right move for everybody, but it’s worked for us. We’re complete opposites. He’s great with people He knows how to talk to people he knows how to kind of negotiate deals and so forth I’m more the analytics guy. I deal with operations money and as of right now projects for the flips

And we really spend a lot of time, like after hours time, focusing on the process, right? Because the process is what’s going to drive your results. Yeah, I mean, and then what’s not working, cutting that out, what is working, it’s a constant balancing act. And that’s really kind of been where our success has come from and how we’ve been able to really keep things lean. We’re just a group of five people, know, me, him.

and two callers and admin and now back into some direct mail campaigns.

Michelle Kesil (07:41)
Amazing. So a lot of people listening to this are maybe earlier on in their investing journey. So what advice could you share to them for like some things that they should look out for or tips to learn from to be more successful?

Matthew Hecker (07:59)
Yeah, mean a couple things. think one of the big things, everybody wants to learn the how or the what. Like what’s the best list to pull. But understanding the why gives you a deeper knowledge. that’s, it’s kind of like the teach a man to fish. Or I’m sorry, kind of like give the man a fish he eats for a day. Teach the man to fish he eats for life kind of thing. So if you start to learn the why and really dig in on that.

That’ll just help your overall progression in any business. think every marketing channel works SEO, PPC, cold call, indirect mail. One of the biggest mistakes I see people doing is trying to go all in into a couple different things and they don’t have the runway to continue it. So they might have

two months worth of budget for ad spend. Well then you probably shouldn’t do PPC, right? So figuring out what works for you from a time and money standpoint, how much time do you have, how much money do you have set aside to be able to put into this, to start the machine. The less money you have, the more time you’re gonna have to have. And then once you get it, pick something, get it started, and then just you really need to dive in and start measuring.

your KPIs. That’s gonna be huge. It’s gonna guide you on what is and isn’t working,

Michelle Kesil (09:19)
Yeah, and what are some of those lessons you’ve learned in your business? Maybe a story of something that you overcame.

Matthew Hecker (09:28)
Man, well one, businesses can get away from you really quick. And what I mean by that is we’ve been in situations in the past where we’re just taking everything down and we’re not managing our inventory. And then our cash would get spread thin and then we’re juggling projects. And we’re having to hold this project off because this project is closer to a draw so we’re pushing that.

forward so that we can then get a draw to then get this project back moving. So I think just patience and just one step at a time and you’ll get there. You’re not going to do it overnight. those are, we had big dreams and big aspirations, but we try to accomplish those on day one. You know, so.

Michelle Kesil (10:46)
Yeah, and I know that you have like different styles for your investments, like the direct-to-seller and the wholesale and the rentals. Can you kind of share a little bit about like the differences or like the pros and the cons between each of those different branches?

Matthew Hecker (11:05)
For sure. So flipping’s obviously, it’s gonna be more intense. It’s gonna require more effort, but bigger profits. Wholesaling, especially for the people just starting out that don’t have the money to really fund flipping and continue to fund the direct to seller approach, wholesaling’s a quick cash conversion. And a lot of times you’re into them for just the EMD. We’re doing $1,000 EMDs on our deals.

So you’d be into it for $1,000. And then you’re going to turn that contract over. Even if you have to double close it, it’s still a 30-day turn. So quick cash conversion on the wholesale, obviously smaller profits. And we’re starting to use a combination of both of those to increase our volume, because we don’t want to do a million flips a year. We’re happy doing.

you know, our 25 flips a year, but we still want to add a little bit to that. So the way we’re going to do that is just through, it’s actually a whole tailing method instead of wholesaling. We’re not going to assign contracts. We just buy them and then we’ll turn around and push them out there to other flippers, other investors that are looking for rentals and so forth.

Michelle Kesil (12:10)
Amazing and yeah, how did you like learn all of this?

Matthew Hecker (12:13)
So the flipping side, I have a construction background. My stepdad had a construction company since I was 14, so that kind of gave me access to understanding the ins and outs of just all the different trades, what finished products should look like, timelines, so forth. The investing side, as far as finances, financials, and so forth, I’ve just done a lot of studying.

on that. I went to college for a while, didn’t end up graduating, but my background was going to be accounting and finance. And then on the wholesaling kind of side, that’s, we were new to that. So we just started with the whole YouTube videos kind of deciphered from what does and doesn’t make sense. And then just started applying it to our business. And then from there using

you know, everybody’s favorite word, spreadsheets. I love them actually, you know, spreadsheets to measure KPIs and just understand what is working and what’s getting us deals and what’s getting us leads and kind of just moving the needle forward through stuff that’s successful.

Michelle Kesil (13:13)
Yeah. What are those top KPIs that you’re measuring?

Matthew Hecker (13:17)
So we want to know from a higher level, like when we’re doing a calling campaign, we’re pulling out of that. How many records go into that? How many dials we’re doing? We’re measuring the leads we’re getting from that, not interested, nurturers, and then solds and so forth. And then we do what’s called a rehash, where we’ll cycle that another time.

So we’ll always measure when it’s a specific type of campaign, like where the fall off is, because that’s the point of diminishing returns. So once you start to get a fall off and nobody’s answering the phones and you’re not really getting anything, that’ll be our cutoff for that. As far as other KPIs, we’re measuring like cost to do a deal, cost to close, cost to get a lead. And we’re measuring it on each level, because we have bulk, manual, and then

we just kick back in direct mail. So every one of those are going to be different. And then profit per deal as well.

Michelle Kesil (14:11)
Yeah, that makes sense. So let me ask you this. What are you most focused on solving or scaling next?

Matthew Hecker (14:20)
So we’re trying to figure out the next level that we want to get to. When you first start off, our goal was to be a massive company. But we’ve realized that’s not really where we want to be. We did 27 deals last year. We know we want to do more. So it’s just really diving into our processes, figuring out the next step that we want to get to.

And how are we going to get there through, whether it’s bringing on an in-house admin that works in our office that’s not a VA, a project manager, a lead manager. So yeah, that’s kind of where we’re at with those things.

Michelle Kesil (14:56)
Yeah, amazing. So I know that in business, there’s always like a moment where things get more real. Maybe a deal went sideways or like you mentioned, there’s always pivots. Can you share a moment like that for you?

Matthew Hecker (15:15)
I think the most real moment we’ve had so far was going back to just a couple years ago when

we were just kind of being greedy, trying to flip everything and we were just over consuming deals.

And then you look in your bank account and you have a million dollars worth of loans and you’re trying to support that with maybe $20,000 worth of cash in the bank to manage projects. And you’re just like, my gosh, what am I doing here?

And that was that moment where you’re like, this isn’t stable. This is that crash, like grow, and then you’re just going to hit a point where you crash and burn. So it kind of really set our perspective on applying some patience, understanding we can only do what we can do.

⁓ And just that was, those were some, it happened a couple of times. So it wasn’t just once and we learned from it. I’m stubborn, you know, but so.

But every time it just makes you sick feeling and you’re just like, we could literally be one bad deal away from bankruptcy. we kind of changed our game and our approach once I was done being sick of those situations. So yeah, mean, that was probably the most real aha moment for us, scary moment.

Michelle Kesil (17:01)
Yeah.

Definitely, that’s the stuff people don’t want to talk about.

Matthew Hecker (17:12)
Yeah, and it’s what a lot of people have experienced.

Michelle Kesil (17:15)
So,

how did you overcome it?

Matthew Hecker (17:18)
⁓ tightened up our deal flow focused on bigger deals to help tighten up and slow down the deal flow started throwing some wholesales in the mix like if we didn’t have money set aside to fund the project then what we would do is just say this has to be a wholesale any future deals so I would tell my brother because I handle the money I would say look man any future deals they need to have X amount of profit

because if we’re going to take it down, it can’t be tight. And if we’re going to take it down and not do it, we need to have another exit, which would be finding another flipper to pass it off to. That way, can still be profitable. So it just made us more flexible.

Michelle Kesil (18:00)
Yeah, I think that’s something really important for people to have a grasp on.

Matthew Hecker (18:04)
Yeah, yeah, exactly.

Michelle Kesil (18:06)
So what is like the next real goal for you?

Matthew Hecker (18:09)
So we are really trying to push our rental portfolio and also at the same time, or the growth of our rental portfolio. And then also at the same time, we’re trying to grow the flips and wholesales and whole tails to a point where we’re ready to take the next step. We just want to get to that.

So yeah, it’s just figuring that next step out. then I wouldn’t necessarily put a goal on it. We’re not big on, we want to do 60 deals a year or 50 deals a year, right? But we did 27 acquisitions last year. So it’s just really pushing to that next level. It probably would fall between the 45 to 50 range. And then converting more of those to rentals.

Michelle Kesil (18:40)
Right?

Matthew Hecker (18:53)
So we’ve kind of gotten to a point where our rentals are actually starting to buy rentals with the cash flow now. And we’ve been waiting on that for like three or four years. So that’s a little bit of a relief that can help kind of propel us in the right direction.

Michelle Kesil (19:05)
Amazing. Yeah, that’s a really big move.

Matthew Hecker (19:09)
Yeah.

Michelle Kesil (19:09)
Now, I know a lot of people listening are either earlier in their journey or looking to level up and I think they’d benefit from hearing this when it comes to building relationships and growing your network. What do you feel has made the biggest difference for you?

Matthew Hecker (19:28)
Relationships with people that have access to capital. We’re not buying all our deals with our own cash. We’re funding them through either private money or we’ll use a credit line through LendingOne as well sometimes. So just being able to do that or having those resources in that network I would think is the single most beneficial resource we have.

it, I, all, once we lock up our property, I can just push it to somebody I know and it’s funded. I mean, it’s, it’s super simple. They trust us. and we, we haven’t gotten to a point yet where we’ve run out of money and we’re only dealing with a couple people that, ⁓ fund our deals, you know? So I think access to capital and access to

capital that’s not extremely expensive, like hard money, will definitely help anybody getting started out. Especially if they want to do more of the flips, more of the BRRRR method, buying the whole buy, repair, rent, refinance. It’s just going to help you kind of streamline that whole process. Double closings, whole tails, the whole nine yards. Yep.

Michelle Kesil (20:36)
Yeah, absolutely. Thank you for sharing that.

All right, so before we wrap up, if someone wanted to reach out, connect with you, maybe collaborate or just learn more from you, what’s the best way for them to reach you?

Matthew Hecker (20:52)
Yeah, I’m a little older, so Facebook is a good method. know that probably makes me seem like a dinosaur. I do have an Instagram account from when I was a real estate agent. It’s agenthecker.86, I believe. I do check that occasionally. Those would probably be my two most active places, where if someone wanted to message me, they would get a response.

Michelle Kesil (21:15)
Perfect. Well, listen, I really appreciate your time, story and perspective. We need more people in this space who are doing things in this right way. So thank you so much for being here.

Matthew Hecker (21:27)
Yeah, you’re welcome. Thanks for having me on.

Michelle Kesil (21:29)
Absolutely. And for those of you tuning in, if you got value from this, make sure you’re subscribed. We’ve got more conversations coming with operators just like Matthew, who are out here building real businesses. And we’ll see you all on the next episode.