When you start in real estate investing – what you know matters most. How to find a foreclosure, how to evaluate deals, how to get them fixed, where to go find money, what marketing to do on the Internet to get people come to your open houses – these are some of the tactics that you go out to seminars, buy books, listen to audio programs and actually learn to execute.

When you grow up in your real estate investing – what you learn to stop doing matters most. After doing five deals, you know what kind of house to pass on and which one to jump on right away. You build a team of good contractors so you don’t have to take bids on everything you do in your foreclosure buys. You figure you how much rehab (or none) you want to do on your deals. You develop a liking for doing something more than the other (REO’s or Short Sales; Rentals or flips; single family houses or apartments). You still have the same time in your hands that you had last year but now you are spending the same minutes more wisely, doing things where you know that the return on your money (private, own, lines of credit) and your time (minus job, family, hobbies) is the highest.

When you finally decide to turn this real estate investing hobby into a full time roaring business. The only thing that matters most at that time are the people you have met in your journey and the relationships that you have painstakingly built with them.

Of course the last thing is the hardest and most time consuming but it is also the most rewarding.

Who have you met today? Who do you intend to meet today? Who did you met last week? Who is on your sheet for next week?

This would matter if you ever want to get to Act III of this adventure.

I spend the better half of the morning going over a transcription of an Audio CD that I build for one of my Inner Circle member to flip houses and duplexes to a particular niche.

It was 16 pages. Times New Roman, size 10, single-spaced.

Could anything be more boring than editing a transcription of an audio CD?

There is lots of “fun stuff” we get to do in our industry.

- Get to look at foreclosures.
- Go to lunches with other real estate investors in your Michigan City.
- Run ads in Craig’s List and see the responses pour in.

I like going to seminars and mastermind meetings and hang out with other Michigan real estate entrepreneurs to get new ideas to implement.

Then there is the “plumbing” things that I have to do – where I get to play plumber, on hands and knees, fixing broken pipes, under the sink, which nobody ever gets to see, like building a Private Money PowerPoint or editing a transcription of an audio CD to wholesale houses which explains the program and on what exactly is required of people interested so whey they meet my member – they are already ready to go and do business, hunkering down and writing 7 emails in a follow-up sequence that goes out a list of people who have responded to a Craig’s List ad.

The fun stuff makes the business interesting.

Becoming a good plumber, if you choose to become good at it, can make you rich.

Photo Credit: DailyInvention

A friend of mine is launching a nationwide franchise type business. He explained the whole thing to me two weeks ago. I loved the concept. My friend is a genuinely good guy, is making tons of money and it is all good but after he was done with his PowerPoint, I told him that he just had to fix one thing – he has to figure out a easier faster way – in less than a minute or so to explain his business to his possible clients. Right now it takes him 10 minutes. I got it. But I doubt a lot of people will have the other 9 minutes of patience.

When you are talking to people who might be interested in doing deals with you – deal partners or private lending – you have to sit and think how to explain all the complicated things that you know in very easy terms.

Obvious? Every sat through a presentation on how to use self directed IRA’s to buy real estate? Guaranteed to put you to sleep in less than five minutes. I find the topic fascinating. You probably do so. But you and I belong to a very small minority of real estate entrepreneurs who get all excited about doing a deal out of your self directed ROTH IRA and not needing to pay any taxes on the profits when we take the money out in our golden years.

We get excited. Most people we talk to get confused.

Problem is that it is the most people that we talk to are the ones we want to do business with.

Faces with things that they don’t understand – most people are too embarrassed to admit so. They take the easy way out. They say no.

You think that they are not interested in real estate investing or may be they don’t like you.

When you talk to people who might end up in business with you, work really hard to make it simplicious for them. Big words, complicated spreadsheets and your industry jargon (most people think rehabbing is for drug treatment and NOT for fixing houses) can come later.

Photo Credit : I'mClaude

Talking to Paul last night, as our little tribe of real estate entrepreneurs was taking a break after my presentation, before converging and staying late, very late till 2:39 in the morning. I did not get home till 3:00am.

Paul was telling me about his upcoming meeting with 10 potential self-directed IRA investors who could fund his future deals. We talked for a while - multiply 10 investors with low six figures each and you can understand the stakes that these sixty minutes carry. Some tips:

1. Make your slides about what is happening now. We have a Wall Street meltdown going on with all major newspapers headlining it. Take a snapshot of their website and use it as an opener. Its sends a message out that you are in the loop of things now.

2. What do you want? Tell them flat out in the beginning. They are there because they are losing money in the stock market and you have an alternative real estate investing partnership strategy for them. Why be coy about it? I always liked having a slide with a title ‘ What do YOU want? What do I want?”

3. Before your build your presentation – ask yourself the five reasons why they would not do this. I am positive that you have some really good answers to all of them. Instead of praying that they would not raise any objections – raise them your self and answer them. Get them out of the way so you and them can get to bigger things.

4. You have a really clever LLC name. You spent some coin to make a nifty website. Great. What these 10 folks really want is to know about you more. They want to know who you are, why do invest in real estate, how did you get here, who influences the way you think about investing, where do you want to go with all this?

5. Take questions. When you don’t know something, tell them you don’t but you will find out and let them know later. The ones that are negative are the best ones to answer in your next presentation. Think of your first talk as market research.

6. Tape your talk. Buy a cheap digital recorder from Best Buy and tape your talk. Not to sell or put it on the web. But for yourself to listen later. You will be shocked on how you sound. Fix the holes.

7. The way you dress matters. First impressions matter. Your enthusiasm about your real estate investing business matters most.

8. Don’t end your talk with, “If you are not going to this today, I want to know what did I do wrong?” OR “ You have fifteen minutes to decide if you are going to move forward.” The first one sounds needy. The second one sounds like an infomercial. I have done both to regrets.

9. Who do you want to do business with if you had a choice to pick from anybody in the world? Who is that perfect person? Do you know? Or is it anybody who is breathing and living on this planet. Build your private money PowerPoint for your perfect investor. You are going to lose the ones who don’t fit that mold but you will attract the ones who do.

10. Use pictures. Lots of them to tell the story of your real estate investing business.

11. Learn to say the word NO when they ask you to do something that you cannot. They are grownups. Their feelings don’t get hurt that easy. Do follow-up (thank you note, email) after the meeting. You will rock.

99% of all the marketing pieces I see in real estate investing:

- Don’t use any pictures.

- Use boring stock images.

Pictures are powerful. Sometimes more powerful than words. You have lot more pictures hiding in your MY PICTURES folder on your computer than you know. You already took the pictures (of yourself, of your deals, of the people who help you get it all done) so why not use them?

Just in case if you don’t have any pictures – here is a great source to get more.

Have you ever tried it? It is not as easy as it sounds. You need a knife to cut the side of the mattress. Then you need to stuff cash in it and make sure that the springs of the mattress don’t rip the cash bags.

That is why even though it is very tempting to think that everybody is not doing anything and just pulling out the money out of the market and stuffing in their mattress, it is more of a cliché than ever.

Sure sales of home safes have gone up but people are not keeping their life savings in them. Just some emergency cash. Couple of thousand dollars maximum. Just to calm down their own hearts when they hear a bank shutting down somewhere in the middle of Arizona.

Money has to go somewhere and earn something for its owners. There are buyers even on the worst day on the market. If there were no buyers – there would be no trade, no price.

Nora has been fighting and losing her battle with a pretty nasty cold for the last week. I finally convinced her after six days to go and see a doctor. She called couple of places and one doctor finally figured a way out to fit her in his schedule. Their talk during the appointment turned to, “So what do you do Nora?” She told him. And his interest in knowing more about what we do was intense. Two of his comments that are worth paying some attention to:

“ I have to put my money somewhere, even now, to make some money.”

“ I have learned one thing from the last 90 days – nothing is guaranteed in the stock market no matter what your financial planner is telling you.”

The not getting of money to do whatever is not a business problem. It is a marketing problem. The stock market has taken care of convincing couple of million people already what this doctor said today. That was the hard part by the way. What you have to do is much easier right now.

I incorporated my current business in January 2002.

Before I fax in the incorporation papers over: here are somethings I forgot to do:

- I did not check what the stock market was performing for the year, last six months, last 90 days, last 30 days and that particular January day.

- Did not ask friends, family, and acquaintances if "it was a good idea to start a business in (gulp) Michigan? Like right now?"

- I did not build a list of every single reason about what could, would, & might go wrong in the next 3 years that would ensure that my business would shut down.

I just incorporated. And then launched.

We, the entrepreneurs, are true believers. Nobody comes closes. If you doubt, hesitate, flounder, look up, look sideways, seek approval of others, fear failure, doubt success...

Then you are not one of us.

The next 24 months, without a doubt in my mind, are the single most important months of every entrepreneur’s life in this country.

This recession is going to test you. To see if you have what it takes. A lot of folks will try, some a little bit, some a lot and then they will throw in the towel. You and I, on the other hand, understand that these are the months that are game-changer.

Your competition, right now, is sitting and writing suicide notes. By not investing in their education, their web skills, their online marketing efforts, by not investing in building a better relationship with the people they already do business with, by not thinking faster, by not reaching out to find potential partners.

They are dead in water, 24 months down, but just don’t know it yet.

I am working very hard, right now, to launch. Meeting new people. Forging new alliances. Calling people and see how can I help them. Investing more and not less in my education, reading more instead of watching the 60 minute Prozac popping binge on network television that passes for news currently.

Continuously throwing mud on the wall and see what it sticks. Most of it will probably fail. And I have made my peace with it because some will stick and take everybody involve to a higher and different level.

What is the plan?

Start here.

Nobody is going to make you rich but you and your effort. People like me lead and guide but we cannot make money and bring it to you in an envelope every night. Nobody, but you and you alone, are responsible for making yourself more coin. Belive in that.

Shortcuts exist but it is only people who are already walking. There are ways to convince somebody to do business with you but it requires you to FIRST launch a business and then work on finding people who will help you grow the business.

Nobody can find you and do business with you if you don’t come out of your room. I write a blog. I go out and meet people in my industry. I try new business relationships. I try this. I try that. And sometimes doors do open that make the distance seem shorter but the thing is… I am at the door, not sitting at home.

You have a bigger ego than you realize. I ask for help. I give away my contacts. I am not embarrassed to tell my people when I screw up. I have an ego also. I just keep it in check when it comes to business. Take a hard look around.

You are surrounded by lots of folks who are down, sad and confused on what is going on. Ask them if there is anything you can do to help them. Zig got it right when he said that if you help enough people to get what they want in life, they will in turn give you everything you ever wanted. But nobody will come to you. You have to go and ask them yourself.

There is a little game I play myself every December. Take a piece of paper and a pen. Go to the bathroom and lock the door. Turn the water on so your significant other will think you are in the shower and hopefully will not bother you for 10 minutes.

Sit on the floor and make a list of everything that you know now that you did not the year before. Flip the paper over and write the names of people you know now because of your business that you did not 12 months ago. Don’t lie. You should never lie especially to your own self while you are sitting on the bathroom floor. Do you have a good list? Both sides of paper? Couple of things? Nothing? Fix it maaan.

Want perfection? I have two words for you - Microsoft Windows. Bill Gates is worth how much again?? There is no perfection in business only a daily attempt to do better than yesterday and not to repeat dumb ass mistakes of last week.

If I can just repeat and rinse that strategy on a consistent basis in my businesses... I know I will do better than last year. And one more thing… how can you make your customers happy? There is lot of profits in asking that question every day.

Get mad skills. Here are some skills that are not taught in colleges but in real world these skills pay a lot, in real dollars, to people who learn how to do them right: public speaking, ability to do a great PowerPoint in 30 minutes or less, knowing how to get your website on page 1 of search engines, knowing how to put people together in deals where both of them come out shining, becoming passionate about throwing great parties and entertaining people who will and would matter to you.

Read a book by somebody you consider a heretic. Hate marketing and selling? Read Secrets of Closing the Sale by Zig Ziglar. Voting Democrat? Read any book by Ann Coulter. Voting Republican? Read Hot, Flat and Crowded by Thomas Friedman.

Why?

Because it is good to train what-lies-between-your-ears to open up to ideas you don’t like because when you start your business, your head will tell you all day long how much distaste it has for your new heretic ideas.. Train it otherwise in the beginning so it does not bother you that much later.

Today is a perfect day to do something. Anything.

While the whiners are whining. The fearful are hiding. The naysayers are drunk with joy.

Good news about that is that they are all busy and cannot bother you.

You and I need to plan.

And launch.

Everything else will fall in place once you start.

About to talk to some new private investors to partner up with you? Here is a great quote by Jim Cramer:

On Oct. 6, he went on the “Today” show on NBC (which, like CNBC, is owned by NBC Universal) and said, “Whatever money you may need for the next five years, please take it out of the stock market. Right now. This week,” he told a surprised Ann Curry. “I do not believe that you should risk those assets in the stock markets.”

I have been collecting and saving images from all the major newspapers for the last three weeks about Wall Street meltdown (here is the link to the software I use). There have been enough headlines to make 20 postcards / whatever you choose to put your name out in front of potential private investors / partners.

Be fearful when others are greedy, and be greedy when others are fearful.

Warren Buffet has some thoughts about buying America... NOW. Read it. It might change the way you are looking at Wall Street meltdown.

Buying a bi-level house to flip when there are hundreds of 3 and 4 bedroom colonials and ranches available and then stressing when nobody wants to buy is energy wasted.

Talking to every loan officer that is related to your wife and your brothers best friend and not trying very hard to find the top performing loan officer in your area first who probably is seeing and talking to more first time home buyers in a week than the first two talk in six months is energy wasted. A friend of mine who finally after months of my tugging did that found out yesterday that the top FHA guy in his county closed 24 first time purchases in September.

Buying a $40 software to spam Craig’s List over and over again with their listings (what some real estate agents love to do) instead of getting a website made that converts visitors to phone calls is energy wasted.

Talking to Uncle Jerry who has no money to invest in your business instead of building a Hit List of local folks in your city who actually have funds to partner up with you and then making sure that you drip, drip your company in front of their eyes is energy wasted.

Running ads on Google and dropping them on a shockingly terrible landing page is energy wasted.

Starting a business, without having any money left for marketing, which typically means imminent failure, is energy wasted.

Dennis mentioned in his comment yesterday about the power of simple things delighting people you do business with.

We have been treating our local post office folks for a monthly lunch for almost four years now.

The easy thing would be to take them pizza. There are two small pizza shops right next to the post office. But where is the love in that? Where is the excitement in that when you know that you are going to get pizza, month after month? It is almost as bad as giving somebody a gift card for their birthday. So we change menus on them all the time for lunch. Every month a different place to buy lunch for them.

Nothing is expected from them. The lunch does not comes with a list of our demands of better service, of making sure that our first class postcards don’t end up in junk mail postcards, our mail gets on the truck and our oversized envelopes that don’t fit on the scale and have to be weighed individually don’t get wrong postage and get send back to us.

It all gets done without asking. We treat them like rockstars. Nobody else does. They remember us for that.

In a very busy world, when people you do business with remember you - that is Mission Accomplished.

Stephanie Wollman, 24, Sioux Falls, S.D., used to work in customer retention at one of the big call centers; you got transferred to her when you tried to cancel your account. Today she and her husband, Clifford, together with their extended family, manage an entrepreneurial miniconglomerate with interests in concrete statuary ("We take 6 cents of material and turn it into a $100 product"), seamless gutters, heavy-equipment rental, three restaurants, 66 acres of farmland, and 140 rental units. She's also raising two kids. Wollman just smiles when I ask her whether she's worried about a recession or if she thinks much about the stock market, currency fluctuations, and the trade deficit with China. It's not that she's unaware; she just has no reason to care.

Source: Fortune Magazine

When you got out to meet somebody – they have already had some idea of what you want from them and how you are going to disappoint them.

- A REO broker expects you to walk in, hoping that he would have a list of killer deals for you, but without having any idea of what kind of foreclosure you want to buy, or bring any kind of solid proof that YES you do have money lined up already to finance the deal.

- A FHA loan specialist expects you to walk in, hoping that she would help you find a buyer for a foreclosure that you just finished renovating, but without having any decent pictures of the finished house to show or having any concrete numbers of what kind of closing cost assistance or other help you can genuinely give to her clients and still hit your target profit.

- An experienced real estate investor expects you to walk in, hoping that he would hire you to bird-dog some deals, but without any idea of what kind of houses he typically buys or how you can help him with his exit strategy (flip, rent, lease option) by either your contacts or knowledge.

I think a lot about what I am going to say when I meet people beforehand. I also try to think and prepare a lot harder on what they expect from me and then try very hard to blow their expectations out of the water.

Goal is that they should not be disappointed but delighted by the time the meeting ends.

It is not easy. But it is yet another way of making sure that you get what you came looking for from that meeting.

A client of mine recently got private money in the seven figures. All in one week.

Pretty good huh?

So what is the secret to the one week-seven figure private money?

He worked on it for almost 8 months. Planted the seeds. Showed off his deals to his pool of prospective investors. Nothing happened for the first seven months. They all listened and watched. Then the stock market took a nose dive and the first thing that went in their heads was “Where can I put my money to use right now if I don’t want to be in the stock market right now?” – his name was on the top of their minds because of his effort. He got the calls and the money.

The microwave is a great invention but it does not work in business.

Sometimes there are no shortcuts.

Another way of looking at it is… eight months are going to go by anyway. Might as well plant some seeds today to harvest later.