600 deals in the past 10 years working 1hr per day

0:00so so if we fast forward to today you now own over 50 free and clear rental properties you flip 40 to 50 properties per year remotely and you own a management company and you do this all from working on all your real estate less than an hour a day so I'm sure that pretty much every single person listening to this would love to be in that position but it's hard to see kind of how that is possible feel it feels like it's just too good to be true so I guess what were the the Milestones or like when did you start to shift your focus from just buying some rental properties where you were probably doing all the

0:48Work to starting to set up systems along the way I think it came from I read the book emit Revisited by Michael G I think that had a big influence on how I started looking at my business and I think it was a big inspiration for recently also to be honest you know I read that book and I started think about wait a minute like nobody other than me personally care about you know the different finishes that I'm putting in my rental properties right if I if one rental property I go in and I have this nice beige color right there's no reason for me to go to the next house and not use the same color I think that's where I was being very inefficient

1:37With what I was doing and then after reading the book it kind of just gave me this aha moment like I could just have systems and processes especially if you're doing a lot of rental properties like I could just have what works for one house in this neighborhood in this city is going to work for every single house you know that I'm doing so now it's gotten to the point like believe I live in California we do all our investing in Northwest Indiana and my project manager that manages all our flips lives 1 hour north of me in California so she's managing everything we don't have any any local person in Indiana I mean I have a property management business I have four employees in that business but they they're separate company they don't do they don't have anything to do with the house flipping business but my project manager

2:26Claudia who lives an hour north of where I live is managing all our flips all our contractors and everyone in Indiana and my lead manager as she lives in Canada she's never visited Northwest Indiana Claudia has she goes once every 4 to 6 months not just to manage our properties but you know she's been with me for about 6 seven years and over the 6 seven years she's built a portfolio for own properties she's bought her own rental properties so she you know every 4 to 6 months she visit just to kind of check on our properties and also kind of you know stay connected with our contractors but yeah I mean like that book and then making sure hiding the right people and then giving them you know the autonomy to make the decisions you know within certain guidelines

3:14That's that's made world of difference got it yeah and what does your team look like Beyond Claudia and you said you had four employees in the property management four employees in the property management but like if I just talk about my house flipping business it's just me with very very very minimal involvement I mean I would say it used to be 1 hour per day I would say it's 1 hour per week now that I spend on the business but Claudia manages all the operational side of it and then I have my lead manager Apple she used to live in Philippines she's been with me for about four or five years she used to live in Philippines she moved to Canada for high studies she's continued working for me and she manages all the like the marketing side

4:03Of the business and that's that's so it's just three of us and then wow you know I own rental properties so I started my own property management company and then we sld properties to other D investors and then for that purpose I start my property management company and then I have four people in that business wow that is incredible to do that much volume with only really three people so I would imagine you know I'm thinking about the things that I am involved in in my business it's it's typically I try to make it higher level task but it's still heats up some time you know one thing that my mind goes straight to is like purchasing the deal so it sounds like you're not even making the decision on what deals to buy anymore yeah I mean we buying like even in Northwest Indiana we

4:51Buying like really four cities Highland griffit medo and Hammond and East Chicago five cities and then we know what what our numbers look like you know we know how much we can sell the property for if you're buying hiend griffit we know it's this is going to be a flip for us if you buy in Hammond marille East Chicago we know it's going to be TurnKey properties we know what the numbers how much we can sell it for how much it rents for so there's like no decision that needs to be made right there's like me looking at picture of a house it doesn't add any value right if if I look at the picture of video of a house it really doesn't add any value to me or to anything in the business so like it just like I've I've delegated

5:39The stuff where other people in my team a lot better at doing that my my role is to just make sure I hire the right people put them in the right seat and then they do whatever they're best at and then the other role is that I make sure we have enough money to keep buying the properties that we want to buy and that's that's pretty much it I mean and then I of course sign the closing documents the buy side I sign the sell side I don't even sign the closing documents I've given part of attorney to my project property manager in Indiana she lives in Hobart so you know when we are selling properties we need to get documents notorized so even that I've given a power of attorney we close every single property s site with the same title company so they don't even have to ask us for the dividing instruction they know instead of me who's going to come in to sign the document that person signs the document

6:28They send the money over and that's that's pretty much it I mean we've tried to make it as simple as we possibly can and that's that's how I like it you know I I really really value my time you know that's the most important you know resource that I have and not not that I'm out there using my time in the you know like trying to solve world hunger or anything like I would just I just want to have freedom of my time and I want to be able to do what I want to do when I want to do with who I want to do you know things it yeah yeah no that makes total sense and I think that's the ultimate goal right because that's the thing you can't get back is time but you know when it comes to the financing side of it I was going to ask you about that too how do you ensure

7:17That you you know that that you're monitoring or tracking the finances you know and making sure that you know if other people are making the decision about investing hundreds of thousands dollars a year money or your Investor's money how do you stay on top of that to know that it's being allocated the way that you would want it to be yeah so for example I'll give you a practical example for my project manager cloudia I've set up a separate bank account right I have a bank account Nova Bank you can set it up with any bank and then my primary operating bank is Chase right so when we enter We Buy in properties it money goes out and comes into Chase but when we're doing rehab I move you know 10 15 20 $25,000 depending on how many projects we have going on once a week

8:05Over to the NOA Bank cloudia the contractors I've never met the contractors I've never talked to them I just know their name because I see them you know their name pop up in our financials other than not like just to give it like if you were one of our contractors working on a I would have no idea I would have no idea you know that you're working on them before we buy the only thing that I need to know is how much money we're going to make that's it I and then I just give a green light on it and the way we've set up P structure for my project manager is she has a base pay of 40,000 and then every project that we sell she makes 10% of the profit but we have to make minimum $115,000 profit okay so we put these you know things in place at the more so she

8:53Makes a lot more money from the bonus than she does from a base pay so we put these things in place where the more money we make as a business the more money she is going to make and then we've also put that you know guidelines that okay if for every month that it takes us to finish the project whatever our total cost is 1% of that comes in comes out of the net profit so let's say if you make buy a house for $100,000 sell it for 150 let's say our total all in 100,000 you sell it for 150 you know there's a difference in that $50,000 profit whether it took us 3 months or it took us a year you know if you spend $1,000 we take 1% of that which is $1,000 and it took us 3 months then $3,000 comes out of the net profit goes towards our you know marketing cost you know holding cost and stuff so now it's $47,000 that

9:42She gets a percentage of but if the same project takes us 12 months now it's $122,000 coming off the bottom line so instead of $47,000 getting split she's getting percentage of you know what is that like 50 minus 12 38,000 so then yeah it's in her best interest to move the project as quickly as possible because you know we're making more money as a company she's making more money you know as part of the profit share and then also we can use the same money you know two or three times a year man I I love that because it's all about incent you know aligning incentives to where everybody is incentivized with the same thing and and that's a really tricky thing to do sometimes or it's not intuitive but that makes so much sense because you want

10:30To just keep turning that turning that money over as quickly as possible so I'm curious used to beant so that's where like just comes from like everything has to be data driven like everything has to be you know whatever we're doing it's it should not be based on my you know intuition my cut feeling or my opinion about something it should be based on numbers I should be able to look at numbers and see you know does it make sense yes or no and then if it does let's do more of it if not then I just stop doing that