We Just Wasted $25k On Marketing!

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Speaker 2: [1:01] Welcome to the Collecting Keys Real Estate Investing Podcast with your host, Mike DeHaan and Dan Austin. From wins, losses, horror stories, and tactics for optimizing your business, Mike and Dan take a real uncensored deep dive into the ins and outs of running a full time real estate investment and wholesaling business.

Mike DeHaan: [1:27] Alright, everybody. Welcome to Episode 16 of the Collecting Keys Real Estate Investing Podcast. Dan was at the helm this past week in our business. I was away at a conference, which is always Gallivanting. Gallivanting around. I know. Yeah. Right. I mean, well well well, the the nice thing about these entrepreneurial sort of groups that we're in is, you know, they're completely voluntary, the people are in, and they're not exactly cheap. I mean, we pay $10 a year to be in this GoBundance group. So they always have their events in, like, cool spots, you know, so it's like a destination. You have something to You know, they're not they're not gonna have it in some crappy area where you go and everyone's bored. So Right. They they

Dan Austin: [2:12] have stuck in a hotel the whole time while you're at conference room after conference room.

Mike DeHaan: [2:17] Yeah. Exactly. Right. I mean, the last thing you want is something like that. Everyone comes up and they're bored or, like, even worse, all they do is just get hammered because they have nothing else to do. Right. You have Yeah. You've taken over this hotel and you set a really bad precedence for, you know, your group in that area.

Dan Austin: [2:34] Well, and I think I with GoBundance too, I like what I like about it is they're very intentional about the activity, like, that part of the the adventure part of your life. Yeah. Like, so if we're gonna do something, it's gonna be adventurous, and we're gonna get a ton of value out of it. And you don't need to spend forty hours of a week in a conference room listening to, you know, people talk. It's like super intentional about everything.

Mike DeHaan: [2:55] Yeah, exactly. And I mean, that's one of their their core values. They said all six or seven of them at the beginning. I forget what they

Dan Austin: [3:01] were. Six.

Mike DeHaan: [3:02] Yeah. It's a six. Yeah. Mean, you already know it. You read the book. Right. But yeah, they had this one in Park City, Utah. It was a good time. You know, brought my wife who went skiing for a few days while we were there, a few half days. A lot of the conference stuff was kind of in the evenings, and then they would have different activities, like sort of community building activities during the day. So I played broomball one day with a bunch of guys, which was pretty fun. Broing down. Broing down. Little little competitive athletics and sweeten the pot. One of the the founders was there and I think was worried he wasn't gonna be competitive enough. He made everyone put up a $100 to play. So we ended up having, like it's like a $3,500 pot. So with the team size, like the winning team, each person got, like, $600 or something.

Dan Austin: [3:51] I wonder if he said a thousand if it's still been brewing down or if it would've gotten too crazy. Like, maybe there's, like, a fine balance. Yeah. Because a thousand bucks, $35 in the pot, like, dudes are gonna start getting physical.

Mike DeHaan: [4:02] I know. They're already getting physical for, you know, a 100 each person. Right? But, no, I think that was, like, the good size for, you know, the the net worth and the income level of people there that they didn't care if they got stuck on like the crappy team, know, because it's like whatever. We're just having fun. But at the same time, like, if you could smell that you had a chance to win, people were getting after it, you know? Yeah. So, yeah. It was it was a good conference overall, though. And it really sort of reinforced my view on the importance of, you know, making sure that you're not the smartest person in the room. When you you know, because especially for us living in a small town, I guess small town, smaller. It's not like you live in Seattle or San Francisco where

Dan Austin: [4:45] It's quite small minded though.

Mike DeHaan: [4:46] It's small minded for sure. But a lot of bigger cities, if you wanna go and be around a players, you just go to a a meetup or Yeah. You know, you can even just talk to people and you'll find other individuals that are doing work and doing well for themselves. But in Spokane, that population is pretty small. And one of the challenges as well is I think the population is small enough that when you do find them, they tend to be competitors in whatever you're doing. So you can't exactly share that much and talk that much deep in your business. Right?

Dan Austin: [5:17] Exactly.

Mike DeHaan: [5:18] But going to this, you know, the the net worth of people there and the size of their business and their income levels varied so incredibly much, you know, from people that are a few million to people that are, you know, 9 figures.

Dan Austin: [5:32] Yeah. I know. It's amazing.

Mike DeHaan: [5:34] And one of the most fascinating things though was that at the end of the day everyone kind of has like similar issues and similar values and similar desires. And you sort of realize pretty quick that regardless of scale, I don't know. Everyone's kind of the same, and it's even playing field, you know, at the

Dan Austin: [5:54] end of day. I mean, the the old adage, everybody puts their pants on the same way. Right? Exactly. Right? And you do get enough round enough guys. It's like some of the people in the group, it's like they're clearly accelerating in life in certain areas. Doesn't mean they haven't had to deal with the same problems you're dealing with or currently are dealing with them or dealing with a problem you can solve. Exactly. And and vice versa, which is cool about it. And that's as we've known is what's helped our business grow is just the value of networking and the value of people.

Mike DeHaan: [6:21] Yeah. And that's why we're in, you know, several mastermind groups, know, we're in GoBundance, we're in our original mastermind group that we started with. You know, we it's on even like people that we work with now, like, you know, the pay us to to sort of learn our stuff. I mean, we learn things from everyone, even like newer people, right? Yep. Because they run into problems that sort of make you think about how to structure it better in your business. Because as we sort of realize, when you have stuff in your business and you're trying to teach somebody else, you almost cover undercover holes.

Dan Austin: [6:55] Right. Yeah. Know, in

Mike DeHaan: [6:56] your business because you're like, oh, I guess I could do that better because I can't explain to you how to do it.

Dan Austin: [7:02] Guess we learn something is to teach it.

Mike DeHaan: [7:04] Exactly. Exactly. But I think one of the biggest takeaways, you know, was the value of, like, you know, paying in your education and, you know, making sure that you're around like minded people even if that does cost you money. Mhmm. Because the amount that you'll get back from that is gonna greatly exceed the barrier to, you know, the cost to entry.

Dan Austin: [7:25] Yep. I mean It's it's just like the simple mindset that you're like, you grow up with your parents tell you these sorts of things too. It's like, can't I don't know. I'm not gonna say you can't because nothing's impossible, but it's it's less likely you're gonna be what you wanna be if you're not associating with those people.

Mike DeHaan: [7:43] Exactly.

Dan Austin: [7:44] Right. Yeah. Well At some level.

Mike DeHaan: [7:46] 100%. And I'm not sure where it initially came from this thought, but I've heard on Tim Ferriss a few times where they say you're the average of the five people you spend the most time with. And I mean, I think that that's so true even if it's like not so people that are in your immediate circle that you see every day, but people that you connect with, you associate with on a regular basis. You know, if you can go to some of these groups, these conferences, things like that, and you find a couple guys that you really mesh with that are doing what you wanna do, and you make it a an intentional practice to reach out to them and, you know, connect with them on a regular basis, you can guarantee you're gonna elevate to their level.

Dan Austin: [8:25] Absolutely. It's kind of well, it happened for us fast, here locally in our market, just the people that we kind of aspire to be. And then you look back like eighteen months to twenty four months, you're like, oh, crap, we surpassed them. And now you need a new group of people. Yeah, exactly. Because it can happen fast. And if you're not paying attention to it, all of a sudden you are the smartest guy in the room and you're not able to continue to scale in whatever avenue of life you want to scale in.

Mike DeHaan: [8:50] Yeah. Yeah. You're completely right. But yeah. So that was that was one of the big things. Then I think the other thing that it really, sort of confirmed is how, like, honestly easy it is to grow and be successful if you are very deliberate about, like, planning your next steps and you're very intentional about making sure that you actually follow through. Because so many people there, and we kind of fall into this a little bit, kind of scrounged up their businesses from nothing. Don't say we didn't come from nothing. Had some resources to start because we had engineering degrees and we had previous decent salaries. But like the businesses, it wasn't like we got handed businesses or we got handed a business that's functioning. We took our legs, we learned, we went through the difficulties of trying to figure out what works and what doesn't. And, you know, for the last couple of years, we've monitored what's working, we've changed things around that aren't working, we've pivoted, we've moved and we've evolved. Hence that's where we are now. And that was the one thing that everyone there had in common was they've gone through the same steps, right? Then even the people that are worth $100,000,000 are out of that group that are starting new businesses, they're still doing the exact same thing.

Mike DeHaan: [10:12] Like if they want to start a new business, it's like, okay, well, what's not working? What is? How can we pivot that? How can we evolve that? And with that extra capital, I think it increases this velocity at which you can get that to be successful. But the process and the struggles are all still exactly the same.

Dan Austin: [10:29] But Yeah. Yeah. And I think there's, like, some sort of, I don't I don't know the best way to say it, but, like, failure is not an option really isn't like the that's not kind of the quote because failure is an option. Right? And if you fail, it's like, who cares? But it's like that mindset that like failure is an option, I think, is okay because you're going to take what you learned and you're gonna pivot however you need to within our business. Like, I think back, you know, for us, there's definitely been challenging times where you're like, we know what's going on in the business right now, but like, no, at no point in time was it like, oh, this isn't going to work.

Mike DeHaan: [11:03] Yeah. Right? And if it ended this, if this right in front of

Dan Austin: [11:06] us doesn't work, that's okay. Because the next step is going to be in the right direction.

Mike DeHaan: [11:10] Exactly. Yeah. And I think it's that mindset shift of, you know, this won't work to how do we make this work. Right. Sure. And and that's a big one. It's just an important mindset shift shift that people have to learn to make. But, yeah, overall, it was good. Very productive week. We got a lot of people follow-up this week, you know, ranging from the real estate business to people to help make us make the podcast better, to people to help us build out some of the educational stuff that we're working on We're gonna be releasing to everyone that listens. You know, there's some tax guys that we gotta connect with. They're gonna help us out there. You know, people that are doing all sorts of things. This is a guy that has some new AI technology for marketing that we're gonna be potentially doing some stuff with, which will be really interesting. I mean, access to those people alone from all over the country is more than worth it.

Dan Austin: [12:01] It's so worth it. Yeah. I definitely have some FOMO of not going. I should have pulled the trigger on going, but life got in front of me, I guess.

Mike DeHaan: [12:08] Yeah. Right. It's alright. Got a, you know, kid expecting life. It's a little harder for you to plus plus, you know, your family isn't like a ski family.

Dan Austin: [12:16] Yeah.

Mike DeHaan: [12:17] For for me and my wife to just go, it was like a event anyway.

Dan Austin: [12:21] Like a normal. Yeah.

Mike DeHaan: [12:22] Yeah. Because we gotta go with, a fun ski town and then my wife worked remotely from there and, you know, she's pretty introverted. So she's happy just kinda doing her own thing too. So it made it pretty easy.

Dan Austin: [12:31] I mean, I'm I'm glad the ski conditions weren't the best like that.

Mike DeHaan: [12:35] Yeah. Right.

Dan Austin: [12:35] Like, I'm happy.

Mike DeHaan: [12:37] Yeah. Anyhow. A bit less FOMO with that. Yeah. That's alright. Yeah. Cool. It's a good good good time, though. So I think more of those more of the story, don't be afraid to pay to play, especially when it comes to education and networking. So yeah. You manned the ship while you manned the ship while I was gone, and it was a little wonky.

Dan Austin: [12:59] It was a weird it was definitely a weird week for us. And, you know, as you and I chatted earlier today, I think we're kind of uncovering some stuff we can chat about here in a little bit, which honestly is kind of fascinating. But I'll you know, before I digress too far. It was weird because obviously, we're working our normal leads, but it felt like none of the mail was hitting. Yeah. And so we didn't get a lot of new leads. We got, you know, cold call leads and and it's, you know, all the leads we're getting is kind of in that, like, we want to sell in the spring. So they're getting ready. It's wintertime, like, as we see. And as you and I know, it's like, we've got to get better at still closing those and and moving forward as a business with those types of leads. But, yeah, that that was definitely this is the first time you went out of town that it was a slow week on acquisitions. Usually, it's like madhouse. I'm just trying to keep up with everything including the acquisitions. And so, you know, it's still still successful weeks. Still got we're still getting appointments scheduled. Had a lot of cancellations with appointments too, which was kind of silly. But, you know, as I talked to people, like, just in general, like, everybody last week had COVID that I talked to. Yeah. They all like yeah. And so, like, it it's like a real it was a real problem that I think the last couple weeks just from any employer standpoint or any just to getting out doing shit.

Dan Austin: [14:19] Just because people were hunkering down because they had it. Right? I mean, my daughter's daycare has been closed a couple times in the last month because of it. Schools are shutting down again. So it's just a little bit of a of a challenge to work around with folks where if people aren't feeling well or something like that, we need to pivot back to doing more virtual stuff with them, which we know is an option. Hey, can you just send us photos? Because, you and I buy houses without looking at them. Yeah. Right? Have somebody else look at them. Right? I'm the construction side of things and I don't see it until it's typically signed around or closed. And so it's not hard to do for us. But anyhow, other than that, like, yeah, projects moving forward, getting all of our closings lined up. It was still like a busy week in some senses, but just we weren't able to run as many appointments as we would typically like in a week, although we dug handful out to to make sure we did. Yeah.

Mike DeHaan: [15:16] Yeah. Yeah. I mean yeah. And and I think that's where it's important to have that virtual side of your business as well. So, you know, at at the conference I was at, there was a few other people that ran pretty large direct to seller outfits. You know, some of them were wholesale businesses, some of them were purely fix and flip businesses. But I mean, I connected with one guy who wholesales a lot of properties down in Florida. I needed like three I think he said 308 deals last year.

Dan Austin: [15:40] Yeah.

Mike DeHaan: [15:41] It's awesome. Just for context, you know, we had our our close was what? Like 40 or something like that. So he did what was that? Like eight times more than us. Mhmm. More than that. Almost nine times more than us. No. Eight times 3,200. Yeah. So three twenty. There we go.

Dan Austin: [15:57] There you go.

Mike DeHaan: [15:57] Yeah, I got it figured out too many zeros. You know, and listening to his business model is he does everything virtual,

Dan Austin: [16:07] you know. But in his home market. In his So we're saying virtual. Yeah. We're talking about in your backyard. Yeah.

Mike DeHaan: [16:12] Exactly. But he doesn't run appointments. He doesn't do any of that sort of stuff. He doesn't even get photos until the property is signed around.

Dan Austin: [16:18] That's pretty awesome.

Mike DeHaan: [16:19] Very interesting. But he's, you know, so he said they closed 308, but he said their contract drop rate was, like, 47%.

Dan Austin: [16:28] Wow. So maybe a 150 ish closed.

Mike DeHaan: [16:32] No. No. No. So they closed three zero eight. That means they got, like, 600 contracts.

Dan Austin: [16:35] Yeah. Sorry. Math's wrong there. Yeah. Wow. Yeah. That's amazing.

Mike DeHaan: [16:39] Yeah. So 50% of the contracts they sign, they don't close because Mhmm. You know, they after they prescreen, they had a contract signed around, then they go to verify it. Mhmm. At that point, they either move forward with the deal if it still makes sense or if there's excess work that the seller didn't make them aware of, then they try to renegotiate. Mhmm. You know? And that that's a very different business model. You know? And he has 20 people in house that work for him, whereas we have two and a bunch of VAs. Right? Yep. So it I mean, but at the same time, I mean, I also live in Florida, so COVID doesn't exist in Florida. Right.

Dan Austin: [17:16] I think it's slowed down by that or the winters or

Mike DeHaan: [17:18] any winters. Exactly.

Dan Austin: [17:19] Yeah. And everybody's moving to Florida right now. Mhmm.

Mike DeHaan: [17:23] So Yeah. But I mean, also talking to another guy who was in Ohio, they kinda do a pretty virtual hybrid model. And he kinda said a similar thing though where, you know, stuff like COVID doesn't really slow them down. And what this guy actually does is if there is a COVID situation, need to verify the property, they go to the property with an iPad and they basically just like leave it on the doorstep. They can like come out, grab it. The people can go and take the photos and then they come out and cool. Now they got their photos to to disposition the property.

Dan Austin: [17:53] Yeah. Perfect.

Mike DeHaan: [17:54] I'm like, that makes perfect sense. Right? So it's, you know, so it kind of gets you thinking when you hear people like that and you hear their systems a little bit. Like, why don't we do that? But I mean, there's there's also an ethical component there that I struggle with a little bit. Like, I don't like to drop contracts. I mean, we've only we've only willingly dropped two contracts in almost two years. I think only two. Yeah. Only two. And then the other ones that we've had that have been dropped have been because of seller issues or title issues that are out of our control. Mhmm. And I don't know if that's a I don't know. Maybe I'm just too much of a softy for me.

Dan Austin: [18:30] Well, yeah. Depending on, like, how you're doing it, when you're doing it, I think kinda also matters. Context matters. But yeah, you don't ever wanna give somebody hope that they're especially the folks we're dealing with, giving them the hope and then a week or even two days before closing, cancel it because they're making arrangements typically. Not all of our sellers are making arrangements. Right? Yeah. But a lot of them are. And so it is kinda shitty to do that. If you're just doing it as a well, it's just a numbers game. I'm gonna drop 300 no matter what. Mhmm. I mean, that's kinda stinks, you know.

Mike DeHaan: [19:01] It is. Yeah. And I think you're right. It depends on the people are when you do it. If you had two days before is always shady. I don't care who you are. Yeah. But I mean, if you're able to get out there, like, three days after, signing on a thirty day close time frame time frame, and then you're like, actually, we can't do this, and that's more reasonable.

Dan Austin: [19:17] Yeah. Exactly. I think that's much more appropriate. Yeah. So, you know, because they haven't had time to make any arrangements. It's not a big deal. And it's and if you're signing contracts the way that they're talking about signing contracts, that that seems appropriate too. Right? Because you might have some contingencies in there like, hey. We do need to get pictures or whatever it is. Mhmm. And then that can tell tell you right away if it's not gonna work.

Mike DeHaan: [19:38] Yeah. Exactly. And and we always have, you know, the opt opportunity to get photos and do a quote unquote inspection when the first fifteen days written into our contract. So we always have an easy out if needed. But, yeah. One of the the situations that we uncovered after we had such a slow week, which didn't really make sense because we dropped 4,000 mailers the Friday before I left. So with our typical KPIs, that meant we should have been getting minimum 40, potentially up to 60 phone calls from that list. Do you know how many we got, Dan?

Dan Austin: [20:12] I didn't even track it because there wasn't enough to track in my head. Six. Six. Yeah. It was so low. The I I what I recognize most of the leads coming in were our guy, Ricardo. Mhmm. Cold call.

Mike DeHaan: [20:24] So a lot a lot of cold call leads. But, yeah, for them that match of mail, we got six instead of the expected 40 to 60. Right? It's bad. It's bad. You know? And so that got me diving in a little bit. And this is where this business becomes challenging because as I you know, there's a lot of things I was looking at, like, our data wrong? Did stuff get messed up along the way? Did stuff even get sent out? You know, there was a lot of things I was trying to sort of figure out and, you know, the US Postal Service isn't exactly the most reliable person on on

Dan Austin: [20:59] the No. They're not.

Mike DeHaan: [20:59] Reliable group. Yeah. Right?

Dan Austin: [21:01] They're not? Who do you call?

Mike DeHaan: [21:03] I know. Yeah. Exactly. Who do you call? Figure that out. But anyway, so I started digging and I so part of our process with anyone who does direct mail has to deal with this. You get a lot of letters sent back that have incorrect addresses. People have moved. People have died. Things like that have happened. So I started looking at our previous return to sender numbers, and they've been increasing over the last few batches that we've sent out. And our number of leads for the same kind of marketing has been slowly decreasing. This has been obviously a big drop off. And so I was like, okay, well, something's wrong with our data. I confirm that's all fine. So I started going through and trying to figure out what exactly the issue was. On our letters that we're getting, there's always a little note from the post office that says why something got returned. And I noticed a huge number of them that say cannot be delivered as addressed. K. So I'm like, okay. So there's obviously the wrong address on here. So I started spot checking a handful of them from ones we sent out in December that came back, and they're all the right fucking address. Like, right like, right name, right address spelled out exactly like is in the assessor website. But for some reason, the post office is saying that they cannot deliver them. And I don't know why.

Dan Austin: [22:22] Yeah. That's that is the golden question we gotta figure out. It's like, you know, you and I were noticing on these, they have barcodes on there. There's those the way that the barcodes are printed wrong. Because, like, there's no I'm looking at one right now on our desk. I mean, you can't get a more clear address and we've checked this one. This thing is accurate. Yeah. And then it's like, can you call the post office? God, no, you can't call the post office. Like, what are they gonna do? You know? Yeah. What I was thinking what I was thinking is, can you imagine, like, all the people that don't do the RTS process like we do? They're just thinking

Mike DeHaan: [22:52] so much down the toilet.

Dan Austin: [22:54] If this happens to you or it is or you're maybe like you didn't do well with with your direct mail, but you never monitor. I mean, because, like, we wouldn't know if at all because we track all of our RTS. We track all of our data and like that. I mean, we wouldn't know. We'd just be sitting here like, man, I guess mail is not working.

Mike DeHaan: [23:11] Yeah. Exactly. I mean, honestly, probably a lot of people that has happened to. So we need to figure out where that that situation is damaged. If there's that barcode, I'm not sure if that barcode comes from our mail house, you know, whichever one

Dan Austin: [23:24] you're You

Mike DeHaan: [23:25] know, we've used open letter marketing, use code keys five for 5% off. And we've also used ballpoint marketing, use code MD five for 5% off.

Dan Austin: [23:36] That's a good deal.

Mike DeHaan: [23:37] Yeah. I mean, that adds up a lot if you're ordering $5,000 in mail. That's $250 you're saving. Yeah. Yeah. So whether it's coming from there or that's placed on the letters by the post office when they process it, I'm not entirely sure where that comes from, but either or or like, I I don't yeah. I don't have to figure out where it's where the issue's happening. So I have a ticket in with OpenLetter, which are these ones are from, to sort of see if they have any insight on it. I've been googling kind of all afternoon and there's just kind of like mixed stuff everywhere. And the thing that I really don't like is there's a lot of people that have reported similar problems other stuff and the kind of general consensus is like, I don't know. The post office just sucks sometimes. I'm like, well, that's not acceptable when you're spending $20,000 a month on freaking mail.

Dan Austin: [24:25] Yeah. When it's the lifeblood of your business rate. Right? Yeah. I'd be curious to know, like, if they do I I I'd be willing to bet they print the barcode on here if they stop printing that. And, like, we sent the same batch if it went out without the barcode, if it would be better or not. You know, something like that. I don't know.

Mike DeHaan: [24:41] Yeah. Well, I mean, I guess we yeah. We gotta look at the different different kinds of of mail and see if there's ones that don't have that that we can see if that same problem still exists. Because, I mean, it's it's such it's such a major issue that when I was sharing with you yesterday, I was, like, 19 for 19 that I spot check all had the correct address and did not get delivered for some reason.

Dan Austin: [25:06] Out of, you know, thousands that you just randomly spot check.

Mike DeHaan: [25:09] Out of thousands that are in here. Right? Like, literally thousands that I'm spot checking. So yeah. I don't know. It's one of the challenges of this business is, you know, and I think any sort of marketing business that that you're you're doing any sort of mass marketing is like, these problems will come up, you know, whether it's sending mail and the post office decides to screw you over while you're doing cold calling and the I forgot the name of the group that monitors all the cold calling.

Dan Austin: [25:39] FCC.

Mike DeHaan: [25:40] FCC. Thank you. And they start, you know, throttling your phone numbers and trying to regulate that whether you do Facebook ads and Facebook changes the algorithm, you know, same with Google, you do anything online. I mean, it's challenging, right, when you're relying on these third parties for your business, and they can just screw you over at any second. You know? Even if it's not I obviously, it's not intentional, but it can be just negligence. Right? Yep. You know, because the post office still getting paid. They they got their stamps. Mhmm. You know? Mailhouse still still getting paid. They got our credit card money.

Dan Austin: [26:16] Yeah. Everybody's getting paid but us. Right?

Mike DeHaan: [26:17] Yeah. Exactly. Holy smokes. Yeah. And not not only that, we're flushing it down the toilet right now. Mhmm. So I know it's interesting. And and the thing that that, I guess, upsets me the most too is we're still getting, like, okay results on the stuff that comes in. So I'm, like, thinking opportunity cost. I'm like, there's probably multi 6 figures in revenue just in the last couple of batches that have had this problem.

Dan Austin: [26:43] Yeah. We missed because

Mike DeHaan: [26:44] of We're not even having the opportunity to shoot for. Yep. Yep. You know? Like, if it's if we're gonna stuff's gonna go sideways, at least wanna be be because we screwed up.

Dan Austin: [26:53] Exactly. Because we could fix that.

Mike DeHaan: [26:55] Right? Yeah. Exactly. We can learn from it. You know, we blow a big deal. That is what it is. But when it's, you know, the incompetence of the post office or, you know, the mail house or something that's causing this problem, it's very frustrating. So, you know, I think the biggest lesson though for everybody on this is make sure you're monitoring your KPIs, your key performance indicators. You're checking, you know, how much is going out, what your people are calling you back. You're actually managing your return to senders, right, which most people don't do because it is a pain in the ass. But otherwise these things will happen, you know, whether that's your cold calls, you're checking, you know, how many dials your callers are making and what answer rates are. If their answer rates are dropping, check those phone numbers. I bet they're being blocked. You know, same with like Facebook, your Facebook conversions or your Google conversions start really dropping, check the algorithm. You know, they've probably they might have changed what's gonna be favorable for you at that point. Or maybe you gotta increase your your ad spend to keep getting the same value. Yeah. So yeah.

Dan Austin: [28:03] That's so important. Like like, if that's like the lifeblood of your system in this business, right, is marketing

Mike DeHaan: [28:07] Mhmm.

Dan Austin: [28:08] Or lead generation, you know. Like, you we always, like, talk about focusing on conversion rates and all that stuff. But if you're not monitoring the lifeblood of your of your business closely and, like, paying attention and tracking it over a period of time, yeah, you're gonna get in trouble.

Mike DeHaan: [28:23] Yeah. Exactly. Yeah. And and, I mean, I think that's where one of the things that's that's difficult about this, like, just business in general, is dealing with these problems is very challenging. And also too, it's freaking boring. You know? Like, it's not exciting. It's not installing flooring and making a house look pretty or, you know, like like, converting sellers or getting contracts signed. This is literally just sitting at your computer, talking on the phone to incompetent people who probably don't not incompetent. They just probably don't know either because they're also just a part of the giant system.

Dan Austin: [29:01] Yep.

Mike DeHaan: [29:02] And it's just like you kinda have to keep digging and then hope that you figure it out.

Dan Austin: [29:06] Yes. Yeah. So Yeah. Yeah. Staring at a screen, looking at data and numbers, and it's not the funnest part of our job.

Mike DeHaan: [29:13] Exactly. Yeah. So but I mean, it's it's a big part of it, and that's a big part of business. And, you know, one of the things too that, you know, as being a being a small business owner, everyone's like, always wants to preach about income, equality and all this sort of stuff with business owners to employees and all that. But for us, especially a small business, I guess you can say that for billionaires maybe a little bit more. But with us, it's like, sure, we're going to make 10 times more than our guys because when we waste $25,000 on marketing, that doesn't affect them. They're still making the same. I'm sure they get a little bit less opportunity for their commissions, but they didn't we're the ones that flush $25,000 down

Dan Austin: [29:54] the road. Exactly. And there's nobody that's gonna give us our money back,

Mike DeHaan: [29:57] honestly. For sure. Right? Yep. So, yeah, it's it's super interesting. But, yeah, so that's one of my goals for the next few weeks is to try and figure this thing out because it's gonna be a big problem

Dan Austin: [30:09] over the next weeks.

Mike DeHaan: [30:11] Know. Me too. I think if I if I prioritize it, it can usually figure it out. Okay? But otherwise, I mean, honestly, what we gotta do is we just keep going and we gotta keep getting opportunities from where we can.

Dan Austin: [30:22] Yep.

Mike DeHaan: [30:23] You know? But, you know, our pivot and look at some other other methods as well, which we're gonna be doing anyway just because but, yeah, interesting times.

Dan Austin: [30:32] Yeah. Great lesson to learn, though.

Mike DeHaan: [30:34] Yep. Exactly. So cool. Well, any good lessons learned? Bought bought a new duplex last week though, so that's cool. I had a mobile notary come out to Park City. I, you know, went there with all the other entrepreneurs and I had to excuse myself from a conversation to go buy a duplex. So that made me feel cool.

Dan Austin: [30:54] It's always cool. Right? Like, oh, yeah. I'm doing deals. Yeah. Park City. Yeah. Meanwhile, I had to drive to walk down to Washington Street to sign it.

Mike DeHaan: [31:01] Yeah. Right. Yeah. Well, I actually had to sign the one doc. But

Dan Austin: [31:07] Yep. Yeah.

Mike DeHaan: [31:07] So we got that one. We're gonna be figuring it out here. It's kind of a a pretty sweet deal. We're not sure if we're gonna keep it or sell it yet, though, because it's like a five three with a mother-in-law suite, like a one and one kind of above the garage. So like it's kind of a duplex, but it's also like perfect for someone that's, you know, wants to house hack, which is all the rage right now, which is basically where you buy a property where you live in a portion of it and you rent out the rest, you can live for free. That's what every get started in real estate podcast tells you you should do if you wanna get started with rental properties. So, you know, it's a high value asset because it's something that like, I mean, a young couple could go live in that apartment and rent out the other side for, you know, the 5 three side for a couple thousand dollars a month and live for free pretty easily.

Dan Austin: [31:54] Yeah. I mean, it it's a sexy, like, asset to be in right now because historically in Spokane, where we're at, like, hasn't been a popularized method, and the city ordinances haven't been favorable to that either.

Mike DeHaan: [32:07] Right.

Dan Austin: [32:08] Right? Where this one's located, it's not an issue. But also, it's just because of that, there hasn't been a ton of ADUs built. Think in the future, there's gonna be more and they're they're changing laws now to make it possible. But just like generational, like with where people are at, and you know, whether they're retiring or young people, maybe they want a mother-in-law or a family to, you know, parents to live in their little ADU while they take care of them and they can have this big nice house. I just think where people are at, it makes tons of a ton of sense to like market that out to people. But then also, it's like, it makes a of sense to keep to.

Mike DeHaan: [32:42] Exactly. Right? Yeah.

Dan Austin: [32:44] That is the that is the big For that reason.

Mike DeHaan: [32:46] Yeah. So But, you know, and it needs a little bit of work. The people that have been living there, it's like a they did some weird DIY stuff. Like, I don't even know what they were thinking with some of it. I mean, I don't know. We went and walked it. Like, they they installed, like, different kinds of flooring in, the main living area. Like, you know, just the the whole downstairs was obviously finished at some point, but they have the jankiest bathroom down. That's all gonna need to be redone.

Dan Austin: [33:12] Just Yeah. Not yeah. It's like don't even bother. Right.

Mike DeHaan: [33:16] You know? Right. I mean, honestly, if you don't know what you're doing, hire someone to do it. Yeah. Or at least like hire someone to come and help you figure out how to do it. Don't just like try to do it yourself and pretend like it's good because then what Just

Dan Austin: [33:29] some style if you're gonna do it at least. Like, don't I mean, you can't mismatch all these four different colors of wood and all this sort of stuff. I know. I

Mike DeHaan: [33:37] don't know. I know. And the funny thing is, is with these people is they tried to sell it for market rate and they were unable to. And then they needed to get out of this property because they, a, they got a hard money loan and they legally moved into it. Mhmm. And then b, they, like, desperately need the money to pay off the loan on another property that they own that has an expiring hard money loan. So now they're taking a bath on this thing and they tried to list it. And and if they had done all this crappy DIY work, they probably would have got market rate. Right. Just invested 20¢ on the dollar. Yeah. So, you know, like, that's that's a big another big learning lesson for people is, you know, at least make sure that you have the skill set and some capacity to do stuff. And if you don't know, you know, you can learn from YouTube videos, but just find friends or something that can help you out.

Dan Austin: [34:29] Yeah. Exactly. Seriously. I mean, that's how I learned. Right? And and I feel like some of my work is actually turning out well.

Mike DeHaan: [34:35] Yeah. I mean, that's what I learned too. Me and my wife finished a basement in our first house that we kinda you know, you helped me with the drywall, but a lot of the stuff we just straight DIYed and then we hired out the shit that we knew was gonna mess it up. You know, like the mudding and taping in the drywall, that was the one thing that everyone said, if that looks bad, it looks really bad.

Dan Austin: [34:51] Right.

Mike DeHaan: [34:51] So we hired that out. And it turned

Dan Austin: [34:53] out great. I've been meaning to tell you I thought that basement looked like shit. I'm just kidding. It did not. No. Turned out. No. You guys did a you guys did a great job on that. And for doing it yourself and saving all the money you did doing it yourself and and on the purchase of the property to buy it unfinished and to finish yourself is huge. Yeah. So, yeah. Not everybody can do that.

Mike DeHaan: [35:13] For sure. I mean, yeah, it cost us, think, like $8 to do all that in that house. And then at the time, I mean, it added like, we had a 0.25, like, $40,000 to do it for a pro. We did it in, like, 8.5 or whatever. And then we went and cash out refinance that property the first time and we pulled out, like, 80 something thousand dollars because it increases by the property so much by adding, you living area, two bedrooms, and a bathroom down there. Mhmm. So, I mean, that's a great way to increase your capital pretty rapidly.

Dan Austin: [35:44] Dude, we've been finishing basements before we even started business.

Mike DeHaan: [35:47] I know.

Dan Austin: [35:48] That's been but that's been kind of like our token thing. Right? Like, we just keep doing it.

Mike DeHaan: [35:52] Yeah. Our bread and butter. I mean, it's the easiest way to increase fiber properties, add square footage.

Dan Austin: [35:57] Yep. And if you have a basement, instead of doing an addition, which is not that's not cheap. Right? Just finishing a basement is pretty darn cheap compared to an actual addition of square feet.

Mike DeHaan: [36:07] Exactly. Exactly. But cool. Anything else from you, Dan?

Dan Austin: [36:13] No. That's

Mike DeHaan: [36:13] it. That's it. So that's it. Alright, guys. Make sure you check your KPIs if you're running a business. If you don't have any KPIs to check, hit us up on our DMs on Instagram. We've been working with a few people here, helping them get their businesses off the ground. We're working on putting together, like, an actual course and some course material to really structure it out that we'll be, I guess, selling to people here in the next little bit. My my goal is by the end of February to have that all sort of, like, built out and start marketing that. So if you're interested, go to collectingkeyspodcast.com and put in your email. We'll give you a little ebook that gives a brief outline of how to start generating off market leads, the five steps to do so, the exact five steps that we took. And then also as well as you're part of that, you will be alerted as we start to release basically what I'm gonna be calling the wholesaler's toolbox or like the business in a box, which is going to be 100% how to launch your business exactly like we did, including things like sales scripts, you know, mail copy processes for how we've done everything will all be included in that. So keep an eye open for that. Besides that, you can follow us on socials on Instagram. I'm Mike underscore Invest.

Mike DeHaan: [37:28] Dan is at InvestorManDan. You can also follow our podcast at Click and Keys Podcast. And I think that's it.

Dan Austin: [37:34] Right on. That's it. Yeah. See y'all next week.

Mike DeHaan: [37:36] Cool. See you all next week. Bye.

Speaker 2: [37:41] Thanks for listening. Please leave us a review on iTunes or wherever you get your podcasts, and check us out at collectingkeyspodcast.com for tips and guides on starting your own real estate investment and wholesaling business.