4 Things Successful Real Estate Entrepreneurs Have in Common

Mike DeHaan: [0:00] I just hosted a weekend mastermind with 20 high performing real estate entrepreneurs, and here are the four things that they all had in common. First off, if you don't know me, my name is Mike DeHaan, and I have bought and sold almost 500 single family homes over the last four years. And I run a community called Scale, which is for real estate entrepreneurs that are trying to grow their businesses to 7 figures and beyond. This past weekend, we had a community meetup for all of our Scale members, and we had a bunch of people fly up here to the Inland Northwest. And on the second day, we did an exercise that I call the Thunderdome, which is basically where everyone has a twenty minute window and they get up on stage, and they speak to everybody, all the other attendees, and they talk kind of about their business and the constraints that they're having. And then as a group, the collective minds of the mastermind, they all work together and figure out some action steps to help that person move forward past those constraints. And it's always a really good sort of constructive thing to kinda get, like, some good team feedback. Anyways, listening to all of these presentations, a lot of the constraints and challenge people had obviously varied, but there was four main things that I saw that were the most common similarities across all the people that attended. So first off, most of the people, especially the ones that were doing the best or the most successful, they were full time investors. And what I mean by that is that they weren't trying to, like, balance their investing company with a w two job, which I know is always something that's very challenging for people to kind of, like, overcome.

Mike DeHaan: [1:27] And a lot of people start their real estate businesses with the goal to leave their w two. But the people that we had there that were kinda growing the fastest and were doing the most deals on the most regular consistent basis, They had left their w two, and they were doing the business full time. Don't get me wrong. You had some folks that were there that were kinda balancing with their w two that were doing very, very well. But by and large, the ones that were doing the best were the ones that were full time in their business. And it's just something to think about. Right? Like, if you are looking to become an entrepreneur, and I understand that there is this desire for security and predictability of having that w two job. But if you are serious about being an entrepreneur and especially building, like, a business that's going to really take off and make you, like, significant money, it is hard to argue with the importance of being full into it, not only just because of, like, the time component that you get when you don't have another job that kinda distracts you and takes up a chunk of your day, but also the fact that you are fully responsible for yourself and you have to figure it out. You don't have, like, a backup parachute.

Mike DeHaan: [2:26] Right? And I think that really forces people to go and work harder and, you know, maybe make some slightly larger risks, but ones that are calculated. Ultimately, they're more inclined to just kinda figure stuff out because they don't have any other choice. Alright. Second thing, they all had a story about how things had gone awry at some point or about how they had lost money on some deal. And so I'm not advocating that you need to lose money or have, like, a bad situation at some point in order to have a successful business, but I think the fact that collectively, everyone had some kind of story of where they lost, whether it was that through wasting money on a marketing campaign that didn't work, whether that was buying a flip that they ended up not being profitable on, whether that was hiring somebody that they ended up having for six months that ended up being a giant waste of time and resources to pay them, whether that was a new system that they tried to install, that they spent a lot of money building that didn't pan out. Every single one had some kind of failure in their business that was easily avoidable, but was part of their learning experience. And I think that that's such a representative part of, like, their success because it's showing their willingness to take risks and to kinda just, like, try stuff out without knowing it's something's going to be perfect. Because when you're an entrepreneur, there's a lot of different, like, kind of playbooks and, you know, guidance and best practices and stuff that you can follow.

Mike DeHaan: [3:43] But, ultimately, it's impossible to know exactly what to do with your business to move things forward. We all have different strengths and weaknesses. Every business has its own challenges. There's always up and downs with every economy, every market. Right? And sometimes you just kinda need to throw stuff at the wall and see if it sticks. And if you're not willing to do that, entrepreneurship is going to be really, really challenging for you. And so I think that the fact that all of these people, they all have some kind of loss, it just shows their ability to try and be creative and be innovative and try to, like, figure stuff out. You know? And that's really what entrepreneurship's all about. Number three, the average time to profitability a lot of these people have when they started their business was usually between six to nine months. And I think that this is an important reminder of the fact that there is no get rich quick scheme out there. And regardless of how many people might try to sell you those on Instagram or social media, there really isn't any real way that you can expect that without just getting super lucky. Right? Like, maybe, you know, you bought Bitcoin back when it was super cheap, and now it's exploded.

Mike DeHaan: [4:44] But either way, that still took a long time, and you kinda had to be really patient. But these people that sort of go and talk about how they made life changing money, you know, millions of dollars in a very, very short period of time are probably being dishonest with you about the situation. And so all these entrepreneurs that came up to the meetup, they all kinda go through the same arc where they get into their business. They don't really know what things are gonna look like. They start spending money on marketing and systems and stuff that they're uncomfortable spending, but they believe in the process, and so they keep working and grinding away and are really, really patient. Usually about month four, they start to make a little bit of money and see some good progress, but they aren't profitable yet because they've spent more money than they've started to make. And then on average between month six and month nine is when they finally start to get to a point where they are making more money than they have invested into their business up to that point. And then from there, they can slowly start to grow their profitability. And that just kinda seems to be the magic number with real estate businesses is six to nine months. And it's not easy or guaranteed by any means.

Mike DeHaan: [5:41] But if you look at these folks who are some of the top members that we have in scale that had really been committing heavily to this, that seems to be kinda like the sweet spot. And so I think it's just a good reminder to know, like, kinda what to expect when you start a business like this. Because if you're starting to get discouraged at, like, three months, just know that you're so far ahead of the average at that point that you really shouldn't be that discouraged yet. Now if you're getting, like, to the edge of nine months and you're still not making any profit or you're not moving things forward as quickly as you'd like, then it probably means you should assess what you're doing and see if you can change a few things. But, otherwise, that six to nine month standpoint, that seems to be a sweet pop for people to start really making money in this business. And then number four, every single person that was there was either single or they had a very supportive spouse or partner that was willing to allow them to take some risks and support them building out their business. This is kinda like a weird one, but in my opinion, your partner that you know, the person that you marry, the person that you choose to live with, the person you choose to spend your life with, one is of the most important decisions that you can make as a person, just as an entrepreneur. And if that person does not align with your values and wanna support your goals, you're ultimately just never gonna be as successful as if you had someone in your corner. Right? And now, of course, the people that are single, they can kinda do whatever they want.

Mike DeHaan: [6:56] They typically don't have to answer to anybody. They don't have a ton of responsibilities. But most of the people that are in the group, they have wives. They have families. They have kids. And it's, like, such a common problem that entrepreneurs face where you know, this is probably one of the most common questions that I get asked by people that are trying to get into this business is how I convince my wife to agree to allow me to build a business and and do this whole thing. But the reality is that I didn't because my I'm very fortunate to have a wife that supported me with that. Right? And a lot of the people that are in the group, they have the same sort of situation. It wasn't always, like, an easy transition at the start. There was always a lot of hesitation to kinda get that initial trust. But now that they sort of have some momentum and they are starting to, you know, see the fruits of their labor and they're starting to have to, like, still take some risks, but the momentum is there, they they have a spouse or partner that really, really supports them and encourages them to keep working harder and keep trying to do better. For someone that doesn't have that or you have a spouse or partner that doesn't support you or doesn't want you to do this thing, I don't know what to tell you. Like, that's a that is a solvable problem, not in, like, a good way, not encouraging you to, like, you know, I don't know, get divorced or break up or whatever. But it is something that you need to consider when you are kinda looking at your goals and what you're trying to do.

Mike DeHaan: [8:12] Because if your home life is turbulent because they you don't have support in your endeavors, then you're just never gonna be successful as someone that does have someone on their side. So, anyways, those are four common things that I noticed of some of our most successful scale members that came out this past weekend. If you are interested in learning how we built a business like this, go to collectingkeys.com/academy, and you can check out the little group that we have set up there. That's like the introversion to our scale community. It's just a couple $100. And in that, we have a whole course, and we have a free little community where you can engage with my team and you can engage with the other academy members. And then also, please make sure to subscribe to this, share it with your friends, and we appreciate you guys listening. Thanks, everybody.