Welcome to the “Making of a DM.” Are you frustrated with your results? What gets measured gets improved. I’m going to share with you the step-by-step formula of creating massive success through measurement. So, with that said, let's get started.
Mark: What gets measured, gets improved. Guys, I’m sitting here, thinking about this over this weekend. Yesterday I was hanging out on a big boat with a couple of friends and we were just talking about life and business. Had the family with me, took the kids out riding the jet skis, and just connecting and talking about things. [01:04.8]
One guy on the boat, he does a little over 100 million a year on an e-com space, my buddy, Brian, and another guy owns multiple companies, does a lot of money in revenue, net revenue as well on top of that. But as they're sitting there and it's cool, I’m the connector guy. I brought both of these guys on the boat. We're having them connect and there are opportunities there. What happens is we're going on this big, amazing boat, hanging out for eight hours. We're talking. We're drinking. We're smoking cigars. Whatever we're doing, just having fun, riding jet skis, just talking.
Business and life, everything is just about big goals and big dreams and conversations, but really what it comes down to is, at the end of the day, kind of what we're talking about today, if you're not measuring these things, first of all, I wouldn't be on this boat. Brian wouldn’t be on this boat. Patrick wouldn’t be on this boat. We wouldn't be on this boat if we didn't have measurements, if we didn't have goals, if we didn't have the KPIs in place to make sure our business is growing and developing, and getting bigger. [02:04.5]
A lot of people are using and the only KPI most people use, because I used to do this myself is my bank account. That was my KPI. If I had more money in it, it was doing better. If I had lost money on it, I was worse. When we're talking, I used to look at my bank account and the problem is the bank account is always, first of all, a false visual representation of what you have going on. It's never going to give you the proper insight as to what levers to push, right? KPIs are different for everybody.
KPIs, by the way, are key performance indicators. In businesses, every business is different, but at the end of the day, I talk about this in my book called The 10 Minute Business Owner. You're on an island and you get 10 minutes a day to hear stats, people, whatever, whatever you need to do to run your operation. Who do you talk to? What are you talking about? In business, it's called you need to know what's going on. Where are we at on sales? Where are we at on the front end? How is everything looking right? Again, every business is different. [03:09.8]
My team, the truth is the less indicators you need to perform your position, if you will, the better off you are. Typically, six to seven is what I see people do. If you can get it down to one, which a buddy of mine does and has one, I have about four, but my buddy has one indicator. His indicator is how many times does the truck go in and out of his garage? Because he knows if he knows that stat number, he knows everything else is growing, right? If it's going up, he knows things are good, good on a good trajectory. If they're going down, he needs to stop, re-identify, and go and drill deep and see where the other issues are. Maybe it's a marketing issue. Maybe it's a staffing issue. Maybe it's a timing issue. Maybe it's a time-of-year issue. It gives you ideas and confidence to keep moving. [03:57.8]
Key performance indicators, what you measure grows. My buddy recently, he was talking to me. He was like, Dude, I haven't stepped on the scale forever, and he stepped on the scale and he was like, Oh, my God, I should be doing this at least once a week. That sounds silly, but, yes, we should probably do that at least once a week. I step on the scale every single day. Every morning, it's part of the routine. I’m doing it in the zombie effect. I literally step on a scale every day, pretty much at the same exact time and I use an iFit scale or whatever, so as soon as I step on it, boom, it documents that and feeds it back to the interweb and, voila, I have it all stored and documented.
But what KPIs are you measuring? What's working? What's not? How do you know if you're moving towards your goal or further away from your goal? Again, back to the problem with your banking account. If you're looking at your bank account as your KPI metrics, it's the wrong number to look at. Why? Like I said it, really, the bank account is often always a trailing indicator of activity prior to whatever days. [05:00.0]
In real estate, it might be a 30-day cycle because you might have 10,000, 10,000, 10,000, boom, 150,000 in the bank. Wire that 150 or maybe you close the deal, and now popped in $140,000 profit and now you have 150 grand sitting there and you're thinking, Oh, my God, I have too much money now and you need to spend more or spend less, so you're always making very irrational, terrible business decisions. I did this for years, guys. It took me I think seven, eight years before I really understood what I’m sharing with you.
No one told me to have key performance indicators. I literally ran my business and my life out of my business checking account, literally. If there was a lot of money in my business checking account, I was having a good day for it. If it wasn't a lot, I was having a bad day. But the problem is when you buy a piece of real estate, that can take a lot of cash out of your account, so you think you have no money, you have no cash, but you're positioning to go get more cash. [05:54.4]
When people come to me and they have $1,000 and that's all they have, they're like, What should I invest in? I always tell them their selves, invest in yourself. Buy a course, buy a book, go to training or something. Why? Because there's nothing in real estate that, I mean, if you don't understand what I know about how to buy properties with owner financing or lease options, or just tie it up in wholesale or whatever, you have to learn that.
You have to invest in yourself. If it's $1,000, take that $1,000 and turn it into millions of dollars. It can be done. I’ve seen it happen. I’ve done it. Many people I know has done it. They've taken a little bit of money and turned it into a lot of money. But making that investment in yourself based on what's in your account, that could be a good decision for you to help grow and start getting in the game of life and business at the next level.
But you’ve got to understand I’ve hired all these coaches over the years. My team has hired traction coaches. We've hired all these guys and gals. Again, I’m not saying hire them or not hire them. I think we were paying 30-ish a year, 30 to 40 a year, and there's a lot of travel inside of that because I’m flying my team out to the locations or flying the instructor out. They're usually quarterly meetings for one whole day, one business day, and there's a lot of preparation prior and then there's a lot of work after, which is fine. It's called business. [07:10.3]
But I think you need to identify, depending on where you are financially and what you're trying to do in your business, what levers you need to pull on your KPIs. If I’m talking to you, I’m like, What numbers are important to you as a business owner today? See, I don't need to know how much is in my account. I already kind of have an idea, so I’m not there where I need to be like, Oh, my God, I need to know how much cash on hand is?
Even though it's a good number to know, I kind of know all the time what my numbers look like. It might be a couple bucks here or there. But what I’m more focused on is did we miss any mailings? Yes or no? That's a KPI I like to know, because if it’s yes, then we have a staff issue. If it's no, that's a good thing. It should always be no, by the way. As soon as it's yes, we're looking into it immediately, I’m going to send it off to the task. My team is already on it and, for me, it makes me see that the machine is working. [08:03.3]
Another KPI I like to have is my daily, and then we do weekly every Wednesday, what does my daily lead gen look like? I like to see leads every day. If I don't have, depending on my media side, if we're not getting 30,000, 40,000, 50,000 leads a day or depending what we're doing in that moment, maybe we're spiking up or maybe we're pulling back a little bit because there's a tech issue, but to get, say, 10,000 leads a day.
If my KPI is 10,000 and it's 1,000, 1,200, 1,800, 1,000 for four or five days, I probably am going to jump in and at least need to know what's going on, meaning I’m not going to jump in and fix it because I don't know how to fix the problem. Me fixing the problem would be addressing it to the team that's managing the issue, the situation, like, Hey, guys, for days underperforming, where are we at? What's going on? I need insight. [09:00.0]
KPIs are meant to just be kind of thrown on the board and, if you see something, red flag, profit off, drill, drill deeper. Again, it's not like this “Look in your bank account. It's a good day.” That's not a KPI. Don't do it. It will ruin you. It will control you. Your bank account will control you. It's not a good control factor.
I have that, and then we have another one where we're talking about receivables. I like to know how many receivables we have outstanding every week. I need to see that number because, in my business, I mean, our receivables are heavy. We could be in the seven figures a month of holding people's money and that since we're being the bank for people in the millions of dollars range every month. If I see 16 or 62, that number is going to mean something different. If it's higher, that means a lot more money is owed to us. If it's lower, that means the accounting CFO team has done their job, right?
Again, you have to not just have KPIs, but decipher what they mean to you and for you, what gives you anxiety and what calms you down. That's kind of what you're looking for in your KPIs. [10:09.5]
Like I said, guys, I’m not trying to be silly here. I’ve hired a lot of people to help me on this stuff, gain clarity on KPIs. Every single person has different KPIs, you know what I mean?
Grandma's Wealth Wisdom, “What you measure grows with the exception of the scale. If you don't measure and track it, it may grow in a way you don't want.” Yeah, I mean, listen, all this stuff, all of it, you’ve got to always be measuring, always be scaling, paying attention to what's working, what's not, and go from there. If you guys have questions on this, I’d love to answer.
Let me go back to where I was on with that topic about KPIs. I’ve hired all these people, figured out the ones that caused anxiety and stress for you. I’ve had some really high-end guys say, Oh, these are the ones you want to track. They don't do anything for me. Again, maybe that's what they say I want to, but I need, for me, it's not about them. First of all, it's not their company. It's my company, so I want to focus on what controls my brain. I want to see what gets me anxious and which one calms me down. I need to see those for myself. [11:14.8]
You need to figure out five to seven KPI numbers as an owner, and, again, those are owner KPIs. Then you're going to have management KPIs, etc. For example, on your management side, maybe you're managing salespeople, so if their job was to make 50 calls a day and their KPI is 50 calls, and they’re only having 20, 20, 20, 20, you have an issue. You have to get on the phone with them or meet them in person or whatever and see why they're only hitting 20 of the 50. Maybe your number is out of range. Maybe it's not acceptable. Maybe they don't have enough leads. I mean, you’ve got to identify the problem and address it accordingly.
That's what's always funny about it to me when I talked to the entrepreneur himself or herself. It’s when they're like, Mark, I’m not getting enough deals. Great, how many offers did you make? One. How the hell are you going to get five deals a week if you make one offer a week? It's really simple math. [12:06.4]
KPIs don't lie. There's zero emotion in data. That's what I always say, data not drama. I don't care if you're sick. I don't care if your spouse hates you. I don't care if your dog doesn't like you. I don't care if your kids puked on you on the way to work. I don't care about any of that. What I care about is the data.
Listen, at the end of the day, you don't care about it either. You're just making an excuse to justify your lack of effort. That's it, no more, no less. If you have a problem firing people, KPIs are your friend. People will fire themselves through data because it's like, hey, I need you to make 50 calls a day based on the numbers you want to reach. You need to have 10 conversations. You need to convert one a day. Can you do that? Uh, I just can't make 50 calls a day. Perfect. Thank you for your service. Appreciate you. Put you back out in the workforce. Good luck.
It's really simple. There's no emotion in that. It's real. Here's where I need to be. Here's where you're at. It just ain't going to work no matter how hard we try, right? Correct. Thank you for your service. Good luck in the new workforce. That's it. [13:09.6]
KPIs give you confidence. There's no drama. It is what it is. Data not drama. What KPIs are “you” struggling with? Which KPIs do you need to understand? You have to know your numbers always, Gary.
Not all numbers are created equal, right? I’ve known my numbers on sales, but I didn't know my numbers on profit. That's a big problem in itself. But as you start developing and growing your KPIs, what you're going to understand with scale your numbers are going to change. You’re going to have to change your numbers. You have to change your expectations. I’m not saying change for the worst. Just got to change and adjust accordingly. You’ve got to be adaptable.
Sometimes, in my companies, we might be investing a million dollars into something, into some technology or lead gen or whatever, so we're adjusting our KPIs. Our profits for that week are going to be lower, for that month or a year. It could be drastically lower, but we're making a capital investment for the future growth, right? [14:12.3]
That's the kind of stuff we're focused on all the time over here and this is, truthfully, why I’m able to hang out with my family and do the stuff I do. it’s because I’m very down into KPIs, the ones that matter, like I said. Gary is right, you have to know your numbers, but I know the right numbers. I think the problem is most people are trying to know all the numbers. I don't know the data team numbers. I don't know the managing numbers. I don't know a lot of the other numbers that, as an owner back in the day, I would have known. I know six numbers, for real. I know six numbers inside and out. I know what they tell me. I know when I hear those numbers, they speak to me. It means something. It's not just fucking bullshit like, Hey, 17, that's your bill. We're on track. Good job. No, these are real numbers. [15:01.1]
You have to really to fall in love with the numbers. You have to really understand what they mean. You have to know if you're on track or off track. You have to know if you're in trouble or out of trouble. You have to know if you're on pace to crush the game of life. All these things do matter.
Again, this is easier said than done. I’m not acting like this is easy, by the way. As crazy as it sounds, it's just a simple number. This simple number has a lot to do with a lot of stuff, so you have to identify these emotional-aspect pieces in your life and figure out which ones you need or want to make you grow, and don't be married to them forever. Mine change often. There's a couple that always stay intact, but mine change often.
My real estate company over on the other side, when they say, Hey, we did a deal, I know that means 10 grand, let's say. That's what that means. I don't need to know what the profit was. I don't need to know any of these timelines. Our typical timeline would be 17 days, $10,000 profit, blah, blah, blah, so the cycle of money. I knew what that KPI driver meant, you know what I mean? [16:11.8]
Guys, as we developed, what was cool was and I was thinking about this today, so as to why I was asking, thinking about this question of KPI, I remember the first time I hit $100,000 a month. I remember the first time I hit $100 in my bank account, $1,000, $10,000, $100,000, $1,000,000+, etc. I remember the emotional feeling of feeling like I was accomplished and for a nanosecond like, Wow, that's cool. Okay, back to work.
Where I see some people get in trouble is, say, they had 100 grand in their bank account, they get complacent. They think they've made it. One thing I’ve realized about money is, once you realize that you can make more than you ever thought was possible and you're providing huge value, great service and got all these cool things going on and you're making major impact at many levels, money, when I say that number, 100,000+ or whatever is in there, it should never get you complacent. It should only get you more excited. [17:08.1]
Because you work so hard to get it, and then once you accomplish it, why would you think that's the end? That's actually just the start of a new journey, because you're ready to crush the game.
Regarding their negative input, I placed all of that on Facebook for a short period, but I was told to take down because it was slander. I’m sorry, I’m human like everybody else and I need to work, and I’m tired of people being mean and hateful when someone like me has done nothing but give them everything, do a hundred percent on the job and even save them some business because there are other employees screwed up.
Without being emotional, without getting too personal, I’ve never been in this position before, so I’m not sure exactly what to do. I'm reaching out in every way, shape or form I can without being negative in nature. Maybe you can help. Maybe you can't, but I’m willing to listen.
Paul, do you want me to shoot straight with you? Do you want me to, like I said, pussyfoot around on the answer? I want you guys to think about that number in your bank account. [18:03.0]
When I hit 100,000, when I opened up my account and saw 107,000 and change or whatever it was, I didn't think, Oh, I made it. For a nanosecond, I was like, Yes. Now what if I just add another zero to that? Who do I need to become to make that a reality? Because I know what I did to go from 1,000 to 10,000 to 20,000, 50,000, 100,000, who do I need [to become]?
By the way, I’m not saying saving the money. I’m not saving money. I’m creating revenue where it's producing cash put in the account and the account is growing and growing, and I’m investing and repositioning, and developing and hiring. Now I have more expenses than ever, but I have more money than ever. I have more expenses and more money and more time. All these things start evolving and you start asking yourself the thought on the thought. We talked about this Magician vs. Mule. The thought on the thought is powerful when you start doing this. [18:58.7]
Ask yourself when you hit 100 grand in your account or 10, whatever the number is, maybe it's 5 million, 10 or whatever the number is, does it get you excited or does it get you scared? What does it do? Does it make you feel complacent like you've made it? Maybe for a moment, maybe for a moment you let your foot off the gas for a second. Literally, the momentum has just been repositioned. You have to be very careful.
I wish I had learned this years ago. You have to be very careful with that because when you feel like you're complacent, this is what almost caused me to go bankrupt twice, by the way, so I’m telling you straight up, I was complacent. I had more money than I’d ever seen in my life and my bank account. I didn't know how to handle it. I didn't expect it. I was just blowing it at the clubs and being silly. I really had no one telling me I’m sharing with you guys. Use it as a tool. Use it as a momentum factor.
You’ve got to realize that at the end of the day, you have to really put the foot down and stay focused on the goal. Not only that, if you can create 100 grand, why can't you create a million? If you can create a million, why can't you create 10 months? If you can create 10 million, what can you create 50 million or 100 million, or beyond? Why? Why can't you? [20:13.3]
I truly believe the reason is most people get complacent at a number. They think the dollar amount is the destination when it's just the new beginning of a new journey. Don't fall in love with the destination. Fall in love with the journey. I’m not saying you can't enjoy the destination. I’m just saying you have to fall in love with the journey because the journey is constantly evolving. People are trying to take your money. People are trying to get in your pocket 24/7. You're going to have maybe a catastrophic experience in your life. Maybe something bad happens financially or physically where it costs a lot of money to get back on track. There are a lot of moving things that happen where money is available. It's a big deal.
Gary, “Currently only making one offer a day. I have a full-time job. How do I increase activity to get more contacts?” Making an offer and making the right offer are two different things. I don't hate making an offer, but you’ve got to be careful. [21:08.6]
First of all, my first question is what does an offer consist of? Because if you're making an offer to a non-motivated seller, it's a waste of breath. It's actually just going to piss people off and it's a false indicator. By the way, I’ve gone with this myself my entire life. Dude, I make 10 offers a day. Okay, great, how many deals did you do? None. You’re not making offers and you're just blowing wind. That's the truth.
If you're making real offers, my offers, you should have a massive conversion rate on offers. Why? Because you should be listening to people and guiding them, and helping them, you know what I mean? You have to be listening. You have to be nurturing. You have to be guiding and you have to make an offer, present an offer or two that could make sense for them.
Gary, the biggest thing is you might not want to kick up your activity. You might want to kick up your conversation quality. Big difference. A lot of times people have the same 30 minutes in a day to actually grow their next company, but how you use it is different. Everyone is using it differently. [22:04.8]
Grandma's Wealth Wisdom, “If you don't have a plan for your money, someone else does.” Ain’t that the truth? Ain't that the truth? I’m going to answer Paul’s question. I’ve never been the foot type of guy, so I’m just going to shoot straight with him.
Number one, your conversations to yourself suck. You have terrible thought processes in your brain. You're a victim 100 percent. No one gives two shits about you except your mommy and daddy, and maybe you. The way you're talking to yourself, you clearly don't. It's just not good. You’ve got to straighten that up first, man. I’m shooting straight with you. You’ve got to get on some mindset books. You’ve got to stop being small time. Your thought processes are very…everything leads to “poor me”, poor Paul, poor Paul, poor Paul.
You know what? Paul, you’ve got to step the fuck up. You're an adult man now. Whatever happened in the past is past. What do you want? Dude, do you know how many people…? I’ve hired thousands of people in my life. I don't think I’ve ever called a reference. You're saying they're calling those references. I’m not saying people don't do that, but my thought process with references is who the hell would ever put a reference down that's going to give them a negative response? Who, ever? [23:10.0]
By the way, if they're giving you a negative response, they probably just don't want you around them and they don't have the balls to fire you because they don't want to put you on unemployment. Why don't you just quit? Why don't you just leave? Go find, go create, go be.
Dude, it's dog grooming. You're not doing heart surgery over there, my man. It's a dog-grooming business. Do you know how many people need their dogs groomed and cut and fed, and their toenails cut and fed, and their haircut and their dogs walked, their dogs shit picked up in their yard? Dude, seriously, if you don't step it up, you're just going to be a victim in the system and the system will eat you up. It clearly already does, honestly, based on the way you're typing and the way I’m reading yourself.
“I’m tired of people being mean and hateful.” Dude, no one is being mean and hateful to you except yourself. I know from my personal interactions with you, because you've interacted a couple of times, the biggest thing is, man, you just talk too much. You have these weird ideas, maybe a little too much LSD or something, and I’m not saying that to be silly. Something is going on and you've got to get it fixed, and you've got to address it. You don't have to fix it. Just address it and acknowledge it, so you can start creating a better path for yourself. [24:17.1]
Life is too short to live in hatred. Life is too short to be a victim. Life is too short to be the “poor me” guy. You're better than that. The world wants more people that are stronger, that can guide them, and not only that, dude, I always think about this. Where you're at in your life right now is only a moment in time. At the end of the day, if you make a pivot with this conversation I’m having with you, because most people might be pussyfooting around with you and I’m not, because you’ve got to take this and use it as energy and fuel to grow, not to use it as poor me.
Poor Paul, oh, man, I knew he was right. Yeah, I am. Yeah, everyone is mean to me. Even Mark is a dick to me. No dude, I’m being straight with you because I actually care, and I’m telling you straight up, you need to get this back on track ASAP, you know what I mean? [25:01.3]
At the end of the day, you get this. This is going to be a great chapter in your book one day. That's how I really think. Anything that bad happens in a moment or I learn that, that's a chapter in a book one day that you're going to write that’s like, At this moment, at this very time, at this thing, I made a decision, not Mark made a decision. I made a decision to become a better person to learn how to talk better, to learn how to communicate better.
When I say talk, I’m telling him to talk. If you're talking shit like this out loud to me, dude, I could only imagine the way you talk down to yourself. You're talking down to yourself constantly, so you're only going to see the world in a negative light. It's not like that. The world is a beautiful place. The world is amazing. There are amazing people everywhere. The problem is why do people, and I know people like this, why do people always have bad experiences? Why are bad people always having bad things happen to them? I wonder why. I wonder why. It's almost like you attract them. It's almost like it's a magnet to you. Until you fix it, nothing will change. [26:06.1]
If you like the feeling, keep doing it. If you don't, adjust, change and enjoy the ride. It's an amazing thing and it's wild to even think that you're… Again, I don't live in that world, so you’ve got to get fixed, man. You’ve got to get fixed, and go groom some dogs. Start your own business. Go to another location. Move. Do something. You’ve got to change, man. You change.
Mike, “You attract who you are.” Guys, again, I’m not here to be a jerk. Don't kill the messenger. I’m here. Why wouldn't I want you to be successful? I don't have any dogs, but there are a lot of people that do and humans are great people overall. Why wouldn't we want you to be successful? I think the biggest problem is, to be honest with you guys, too many people are out there just being nice to you just because that makes them feel good. [27:00.0]
As a leader, it’s your job and you're often saying stuff that might hurt, that might be portrayed as hurting someone's feelings, but, dude, those moments have changed my life. I’ve hired many mentors. I still have mentors. I want them to shoot straight with me. I want them to call me on my B.S. I want them to smack me in the face. I want them to pat me on the back when I deserve it.
Let me just comment. Not when I deserve it. When I did the work and I’d get a quick pat on the back, get your ass back to work, though. Not like, I deserve it. Pat on the back, Bill. I deserve it. Come on. Not that. Not that kind of deserve it. I’m talking, I’ve busted my ass. I’ve got an accomplishment. Dude, in our world, we're not getting pats on the backs like that. We're not saying, Hey, good job, guys. Look what we did. It's like, Man, if we can do this, wonder what else would we do, you know what I mean?
Believe in that. You have to really acknowledge where you're at, where you want to go, and create the path, because if not, someone is going to create it for you.
We've got someone on here, Beacon. Nick, what's up, my man? Question. [28:00.8]
Mike: Yeah, you were mentioning numbers. I never really see a number as I’ve made it. I’m constantly subtracting. You have 1 million. How long is it going to take me to get two? You hit two. All right, at this rate, how long is it going to take a hit two and a half? Lifestyle change, factor that in. Is it all just one constant equation for you or are you…?
Mark: Constantly evolving, man. Right? We're becoming new people. Maybe you have kids. Maybe you don't have kids. Maybe they're getting older, maybe younger. B the way, I’m not just looking at how much money I made. I’m looking at how much money I keep, you know what I mean?
Mike: Sure, absolutely.
Mark: Where am I placing that? How am I growing it? How can I develop it out? I play games with myself all the time with money like, How can I create X, go get XYZ? It's not even about the doc. I need to create and constantly be evolving with capital. That's just what excites me. [29:00.0]
Everyone is different with money. Some people use money as it's too emotional. To me, it's just a big game with money.
Mike: Not to get off topic, a lot of people I respect are under the same opinion as me that come September, October, once the moratoriums and things are lifted, things are going to get very interesting. In theory, you can't even go to the courthouse right now to evict somebody and I think we're just going to see this flood of action from evictions to companies folding, people having six months of rent due at the same time. I think it's a great time if you have capital to deploy that there's going to be opportunity there. Do you have a certain window you're looking at? [29:51.6]
I’m primarily looking at vacation areas, beach areas, vacation destinations that have been hit the hardest right now, places that have put suspensions on Airbnb services. Because those guys are getting crushed right now, everyone is going to be switching to long-term rentals in those areas, so we're going to see price drops and we're already seeing a flood of inventory coming online. The guy that's got 10 properties maybe lets one of them go, has to let one of them go to try to keep the other nine and just at the macro level. What are you forecasting? I’m assuming you're in okay shape in terms of being liquid. What are your plans on trying to [benefit from] one man's loss is another man's opportunity I guess?
Mark: I spend zero time in that space. It doesn't matter because it doesn't serve me at all. I’m constantly creating relationships today to get access to more capital. I’m constantly getting relationships to get access to more deals when that happens. I’m focused on what I can control and what I can do. Theory is all bullshit, dude. Theory doesn't serve me. It doesn't help me. There are a lot more smarter people out there than me that will go bankrupt during these times. Why would I spend any ounce of energy or thought space to think about what could, should, would, might, maybe happen? It doesn't serve you at all. [31:10.3]
It's just a circle and your buddies. No, Dude, this happens in September. No, this will happen in November. No, man, check this out, check. Dude, who knows? No one knows. Who cares? But I can control this. I can plant seeds and get access to $100 million. I can plant seeds to get access to private deals that are going to come up on the market when that happens.
I control all that, so when it happens, if it happens, I’m there. If it doesn't, I’m there. If it happens halfway there, I’m there. While all you guys out here theorizing, I’m actually doing the work to get the deals, and I went through this in 2006, 2007, 2008, 2009.
Everyone was out here talking, When is the market crashing? Dude, we're right in the middle of it. It's already happening. When you're in the game, dude, when you're in the game, there's no theory. It's real. It's happening. You can see it. You're in the business.
You'll see your KPIs start adjusting. You'll see like, I’m making double the amount of calls and doing the same amount of deals. There's a disconnect. Why is that happening? And/or the opposite. I only talked to two people. I’m close with four deals. Why? Because they need to sell fast. They need to cash today. Our timelines might go from 17 days to three-day closes. Why does that happen? They need cash today, right now, right? [32:11.4]
We don't theorize. We do the work and get the results. That's it, man, for real.
Mike: Completely hear what you're saying and where you're coming from. If you're in a position that you have a budget to make several long-term moves, would you still be taking the same approach of I don't want to say shooting from the hip, but some level of research, if you don't have access to making that phone call on safe places, and having nine-figure funding and you're self-finding everything, same approach there?
Mark: I don't know. I would adjust my energies in getting access to the money. If you're worried about what we're talking about, I would keep my cash rather than do anything with it. I’d invest in myself and learn, and go meet people that have cash and get access to a lot more, you know what I mean? Hence, the opportunity. People that have cash, don't like the market, the real estate market or stock market. [33:01.6]
The good thing is if the market does shift, people already have a baseline from 2008, 2009 and 2010, because I’ve never met anybody that's in real estate said, I wish I would have bought less in ’08, ’09 and 2010. They wish they had bought more, so now they kind of have a little bit of comfortability with the market shifting. They understand the dynamics of it.
Just constantly be plugging away with conversations, man. But, yeah, I mean, just like Grandma's Wealth Wisdom says, that's why you need to know your numbers and KPIs. All this stuff, dude, I mean, first of all, if you're in for the long-term, what does it matter? What does it matter what it's worth? You're a long-term place for cash flow, right?
Mike: Yeah, but, I mean, if we're talking there's going to be a 30% drop in the next X amount of months…
Mark: What if it never drops? Then what? What if it goes up?
Mike: Do you feel we're in a position where things are going to go up?
Mark: I have no fucking clue. Do you? No one knows. Again, I spend zero [time on it] because it doesn’t matter.
Mike: I hear you. [33:56.6]
Mark: Based on what you said, though, you're talking two sides of the conversation, long-term and short-term conversation. Way different strategic place, massively different. If you're worried about the market going down, don't do anything long-term. Why would you? It makes zero sense in your brain. You're playing mental gymnastics like, What if? What if? What if? Oh, I want to move. Oh, I can't. You're constantly stuck in the state of stalling. I’m stalling. One more month, it's going to change. Nope. One more month. Nope. No, for sure, one more month, it's going to change you. Dude, it's 2028 already. Let's get the fucking deal. Let's go.
Dude, you're thinking money is only a small amount. There's so much money out there and so many opportunities. Short term is a different play. Long term is a different play. Which one do you want? That's the question you've got to come to a conclusion with for yourself. If not, dude, you're sitting in your house all day just thinking about real estate, not doing it.
Mike: That's interesting. Okay. I found that to be really interesting. I would say, we're kind of in unprecedented times and forecasting is something, not that I’m a huge fan of it, but we've never had to forecast what happens when courts open back up when lockdowns end. [35:12.6]
Mark: So, how can you forecast this if it has never happened? There’s no [inaudible] needed.
Mike: That's exactly what I’m kind of getting at it. Then you're kind of betting on the situation.
Mark: Do you own rentals now?
Mike: I do.
Mark: What's the collection rate right now?
Mike: Percentage-wise?
Mark: With your direct clients, how many people are not paying percentage-wise?
Mike: I’m very fortunate that I only have two that aren't, so 80% are paying.
Mark: Okay, so what are you worried about? Dude, I’m telling you, you and everyone else I know, 80 to 95% of people are paying rent. When the courts open, why would that change? It won't. That's why it won't change. People are paying rent, dude.
Mike: Right. Yeah, I guess I’m looking at it differently. [35:58.5]
Mark: You're listening to the news over there, my man. Focus on your numbers and your deals. I’m telling you, everyone I know, their tenants are paying. They're on time. Actually, some of our guys, their numbers are up. Why? Because people have access to more money. They're at home all day. They can't lose their house.
They need their house. If you don't pay today, you're going to get kicked out. It might be three months, three years, a year, but you're going to lose your house and it's going to be on your credit forever.
Again, I think the world is amazing. I think we have great people in this world and I think most people want to pay their bills. Now they have money to pay their bills at another level. They're making more than they ever had. They can’t go spend it like they used to. There's a whole massive opportunity, and you're thinking when the thing opens up, it's going to get worse. Why? Why would it get worse? Again, not my thoughts. I’m looking at my data to tell me what’s working and what’s not.
Mike: No, I don't want to say hoping it's going to get worse. I’m looking at it as an opportunity to purchase.
Mark: Dude, the opportunities are every day, every hour.
Mike: No, agreed. Agreed. I’m looking at markets that I’m not currently in, I guess. I’m here in the northeast. I’m looking more at areas that have been drastically affected by tourism being down. [37:08.2]
Mark: You're talking Airbnb props? Is that what you're talking about still?
Mike: Yeah, like a Miami type of area, something like that.
Mark: Yeah, but, dude, I mean, I’d say stay focused on what you're good at. I don't know how much money you have or what you're trying to do, but if you're only working with own, I’d stay with what I know and just make a lot of money. Why bounce around into a pool? What do you gain by buying one property in Miami? A couple bucks? Now you're chasing money and hoping it works out. I don't chase money, dude. Money runs way faster than I do. It's electronic, right? It goes through the airwaves.
I’m focused on [me]. Again, everything I do, I focus on me, man, what I can control. I’m not trying to get a deal in Miami, a deal in California, deal up here because it's the hot opportunity. Go let people chase that while I stay focused and build my business.
Mike: So, you're not a big fan of the stock market then? [38:00.0]
Mark: I focus on me. If you're good in the stock market and you know what you're doing, make a ton of money. It's easy right now. Everyone is a genius in the stock market.
Mike: Everyone is a genius and everyone is an idiot at the same time. Those things tend to come in waves. Yeah, I mean, I guess I’ve looked. I’ve had more success there and trying to look at it the same way, which I guess might not be a good approach.
Mark: It's definitely not the same approach, my man. It's definitely not the same. Listen, everything is in waves constantly, but real estate has a different scale, but you can't push a button and do a deal you can in stock. I can buy a million shares of anything I want to in a nanosecond. That's not how real estate works, dude. It's a people business and you're doing a lot of emotional people right now on many levels. If you have the emotional fortitude to do that, it's awesome. If not, it's cool, too. If I was great at the stock market and I was making money, I’d stick with that.
Mike: I understand. I appreciate that answer.
Mark: Real estate is a lot slower than the stock. Literally, if a news story breaks on the stock market, it can plummet in a nanosecond. Real estate, dude, it takes forever, potentially never. If you're playing that side of the brain, I mean, I know a little bit about the markets. It's totally different worlds, drastically different. [39:14.1]
Mike: Got it. Got it. I appreciate you going over that and it's going to be interesting. It’s always interesting looking back, but it's always more exciting to look forward.
Mark: I don't look back and I don't look forward. I’m focused on now. I can barely do it now, man. There's so much going on. Again, man, I really think dial in your KPIs if you really have a good visual representation of what you’ve got going on.
There's so much noise out there, I don't know who to [believe]. I can barely believe my own numbers. I see them every day. I’m trying to decipher what my own numbers that I know say. Why am I worried about what you do or Steve John down the street in Texas is doing? Dude, I don't know. First of all, I’m assuming, we're assuming their numbers they're giving are real. How would we know? I don't know.
Mike: That’s true. [39:59.8]
Mark: There's no one auditing and validating these numbers, and putting a stamp on them. I know mine. I’m not joking when I say, my number, I have so many moving numbers and multiple businesses, it's hard enough just to know what they're saying and I get it wrong often. So, I’m making decisions based on my data and I can still be wrong. That's just crazy how that works. But I think people’s emotional warfare is a real thing, man. You’ve got to protect your time and brain power.
Mike: Have you noticed a difference with your KPIs as of late, anything macro-related you think outside of what you're personally doing?
Mark: Everything is great. We're crushing it. Actually we're improved. We're growing. We're hiring. I do know based on
Mike: Sometimes say that’s a difference, unless nothing has changed.
Mark: Basic, just basic method, just basic life, people are scared. In business when people are scared, I go all in. I put more money because of people that are scared. You're worried about the market going down. I’m worried about making money today. Two different worlds.
Mike: To be clear, not to cut you off, Excited about the market potentially going down. [41:06.6]
Mark: I know you are. That’s opportunity there. I’m not excited for it, but I’m participating in it on the outside.
Mike: Yeah. No, exactly. Just to be clear, not scared, but I kind of almost hope. I hate to say it out loud, hoping. You never hope that a group of people, but if it’s going to happen.
Mark: It’s going to take you months to see a deal that you might be thinking as your deal. We've done thousands of deals inside that same timeline. I think the difference is volume, what you are trying to accomplish, what you're not. When I hear short-term and long-term conversations at the same time, that's a massive disconnect with yourself. You’ve got to figure that out. But, for me, everything we're doing is in 17-day increments in our real estate business. We're not looking massive.
Mike: How long did you say, 17?
Mark: Seventeen days. It’s how long it takes us to acquire and sell a deal on average in our company, so that's our KPI, 17 days we're in, we're out. Boom, we're moving. Often, what happens in markets like this, the cycles get sped up a little bit because people need cash quicker, and then we're selling faster. But what happens as well sometimes in that is you might shrink your revenue. You might shrink your net profits. Why? Because you're just looking for speed plays at that point. You’re just quickly in and out, quickly in and out. There's no right or wrong. [42:14.0]
Dude, anybody who says their KPIs don't constantly adjust have no business. It's constantly adjusting. There are some baseline ones, but at the end of the day, business is business. It's easy. Just spend attention.
Mike: True. I got you. Appreciate the hour. Appreciate the advice, man.
Mark: Definitely. Thank you, buddy. Appreciate you being here, my man.
Mike: Talk to you soon.
Mark: Awesome. Christopher, “Make decisions right now based on the current data, not on the…. Yes, I agree, man. I agree. I’m all about going deeper, not wider. I’ve seen so many people get wiped out going wide. By the way, how or why? It's very simple. Resources.
It's hard enough building a business at one location. I see investors do this all the time, by the way, wannbe investors. They do two deals a month in their market. They go to a conference or listen to someone say, Kansas City is where it's at. Now they're starting a Kansas City operation. No, man, really Philadelphia is right. Now they have Philadelphia. Why are you trying to do two deals in each one but half-assly? Why not just focus on one, go deep, not wide? [43:10.8]
There's so much opportunity based on what Chris is saying. Grandma's Wealth Wisdom, “’08 was a new scenario as well. It never happened. The reality is we'll always have things that never happen. Focus on what you control.” A hundred percent, man. As you guys know, that's what it's about.
Good stuff. Beacon, I’ve got to bounce. I’ve got to get to work. I’ve got to get all my KPIs today. It's Monday. It's a big day. I’ve got a lot of cool stuff going on, guys. Hey, if you haven't got your copy yet, make sure to get your copy, Magician vs. Mule. Get over to MagicianVsMule.com. If you did get your copy, please relieve her review over on Amazon or enlighten it up over there. Audio version comes out on my birthday. June 19 is my big birthday. I’d be 42, which is crazy to me, but better than the alternative. But I want to make sure you guys understand that book, we have some cool stuff following behind it, so make sure to put your email in over at Magician vs. Mule to stay up to date with what we’ve got going on. [44:04.6]
I appreciate you guys being here. If you have a topic you want help on, please shoot me a private message. I’ll see what I can do to answer the questions as we're looking to retool the show a little bit here and there about where we'll place, when we're going to do these shows, if we're going to keep doing it every day of the week or if we're going to move once a week or whatever.
Appreciate you guys being here. Thank you for sharing the show. Make sure to check me out over on podcast on iTunes at The Making of a DM. If you need anything in the meantime, let me know. Appreciate you guys being here. Have an amazing Monday. Make today count. Peace.
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