Building and Scaling a Massive Real Estate Business

J:
Welcome to the BiggerPockets Business Podcast show number 78.

Nathan:
And I tell my team this all the time, “I expect me, myself to earn my seat every day and I expect you to earn your seat every day. And so the person that you were hired on March 4th or whatever, I expect you to be better today.”

J:
Welcome to a real-world MBA from the school of hard knocks where entrepreneurs reveal what it really takes to make it whether you’re already in business or you’re on your way there, this show is for you. This is BiggerPockets Business. How’s it going everybody? I am J Scott and I’m trying to change up my inflection, but it’s not working. I’m still J Scott. And I’m still here with Carol Scott, my lovely wife and one day I’ll think of a new intro. But until then, how are you doing Carol Scott?

Carol:
Laughing at you. I’m doing great. I’m a little bit bummed though. It occurred to me that right around now would have been the 2020 BiggerPockets Conference in New Orleans. Oh my goodness, we miss our BiggerPockets family so so so much. But that will make 2021 even sweeter, right? Got to look for those positives. We’re going to get through.

J:
We miss everybody. But we will see everybody next year and hopefully talk to everybody many times in between. Let’s talk about our episode for this week because we have an awesome episode this week. We have somebody that a lot of you probably know, his name is Nathan Brooks. He is the founder of Bridge Turnkey Investments. And the reason you may know him is that he’s actually been a guest on the BiggerPockets Real Estate Podcast four times now.
So Nathan, he is a Turnkey investor and we’ll talk about what that means. Over the last five years, he and his company have renovated and sold over 500 houses. This year, his company made the Inc. 5000 coming in at about I think he said 1,304. So one of the Inc. 5000 this year. And while Nathan is a real estate investor, and while a lot of what we talked about on this show is related to real estate, we’re a business show. And so on this episode of the podcast, we’re not going to talk all about the stuff that Nathan has talked about on the real estate podcast, we’re going to talk about his real estate business, but we’re going to talk about it from a business perspective.
So if you’re a real estate investor, you’re going to love this episode because we’re going to talk all about things that are going to relate to you and your real estate business. And if you’re not a real estate investor, you’re going to love this episode because we’re going to be talking about how to build and scale and grow a business whether you’re in real estate or not. So an amazing episode with an amazing investor. On this episode, we talk about things like using KPIs, which stands for Key Performance Indicators, basically how to measure your metrics in your business and why it’s important.
We talk about creating processes and we also talked about when we should not be creating processes. We talk about building an amazing culture in your business. And then Nathan dives into what we need to do to be amazing at hiring employees. And we talk about the single biggest component of hiring that we’re often afraid to do but is so important when we’re hiring in our business. So if you’re thinking about hiring somebody, this is a must listen for you. And then for you real estate investors who are excited about hearing from Nathan Brooks, a real estate investor himself, we do talk about some real estate specific stuff like how he’s finding deals in this market and how he’s finding money and financing deals as market.
And then the one thing we talk about throughout the entire episode is Nathan is a voracious reader. And we talk about I think six or seven or eight great book recommendations. Overall, this is just an amazing episode that any real estate investor, any business owner is just going to get so much out of. So if you want to learn more about the things we talked about, about Nathan, about his business, check out our show notes at biggerpockets.com/bizshow78. Again, that’s biggerpockets.com/bizshow78. Now, let’s jump into our episode with Nathan Brooks.

Carol:
Nathan, welcome to our show. We are so looking forward to chatting with you. You are such an awesomely inspirational in multifaceted business person. There are so many great things to talk about. So thank you for being here today.

Nathan:
Oh man, Carol, J, I’m so pumped to be here, I so appreciate that introduction and it’s a blessing to be here with you guys for sure. So I’m pumped.

J:
Awesome. Well, we are thrilled to have you. For anybody that’s listening that doesn’t know Nathan, basically you are a real estate guy. So this is going to be a real estate related episode. But, even though you’re real estate guy and you’ve been on the BiggerPockets Real Estate Podcast four or five times now?

Nathan:
Yeah, four times.

J:
Four times now. We’re going to talk about your real estate business. But we’re going to do a little bit different, we’re going to talk about from the business standpoint because a lot of people out there, they may run real estate businesses, and this is going to be an opportunity for them to really learn how a real estate business is run. And then there are plenty of people out there that don’t run real estate businesses, but like we talked about all the time, business is business and learning how somebody runs their real estate business translates into running other businesses and vice versa. So thank you so much for being here, and being willing to share your business story and all your business expertise and knowledge with us.

Nathan:
Absolutely, yeah. And I love that, I love the connection between real estate, and business and it’s learning both ways, right? So I learned all the time from people who are in business outside of real estate because it gives us a different vantage point. But solving similar problems or opportunities or whatever that might be so there’s a lot of cool things that intersect there. So I’m looking forward to it.

J:
Awesome. So let’s start with for those who don’t know who Nathan Brooks is, tell us a little bit about your backstory, what you’ve done in the past, what you’re doing now and what your business is.

Nathan:
Yeah, absolutely. So I’m Nathan Brooks, I’m out of the Kansas City area and I have a beautiful wife and two awesome kiddos. And we just enjoy the heck out of living on 11 acres and doing all kinds of stuff like hunting and shooting guns and fishing and boating and playing and just enjoying the outdoors in nature and this time of year is amazing with all the trees changing. And so just enjoying that and as far as professionally, we have a Turnkey company, Bridge Turnkey Investments, this is going into our sixth year of business and so we have about 15 employees. And we made the Inc. 5000 list this year for the first time which is cool.
I think 1,304 was our number out of 5000 fast-growing companies. So it’s just a number, but it’s cool to represent the effort that our team has put forth. And so what we do is we buy, renovate and sell homes and we do that at scale. We’ve done a little over 500 houses so far in the last five years. And this year we’ll put about 140 or so on the board. So it’s quite a few, takes lots of learning, and lots of amazing people doing amazing things. And so over the last four or five years, six years, it’s been the story of that business and bridge and I got my inception story if you will on the BiggerPockets podcasts going through, trying to do it myself, and going the boom and bust in the past recession ’08, ’09 which wasn’t fun. And I’ve told that story a bunch of times, but it sucks, you don’t want to do that.
So really put the focus now on our team and what our individual and collective strengths are and how can we do that together as a company. So I don’t know if that did a justice answer in there, but.

Carol:
That is awesome. Congratulations by the way Nathan on making it on the Inc. 5000 list. I can’t even imagine what an honor that must have felt like after all of your amazingly hard work all these years. So cool.

Nathan:
It’s cool. It’s a neat thing and it is one of those things too. You have to apply for it and there’s other people obviously that have not applied and that I’m sure they would be on there. But at the end of the day, something that’s a cool benchmark to see where you’re at and what are you doing, what are you producing, and also a cool place to gather your team and celebrate some successes amongst things that are either challenging or whatever’s going on in the business, you can stack hands on that. So it’s very cool.

Carol:
Super. And I want to come back to the whole team building aspect and culture building aspect of your company as a whole at some point later in the conversation. But to set the stage even further, can you give us a little bit more information about how turnkey is different than flipping?

Nathan:
Absolutely. So there’s really two components there Carol. So the flipping, anybody does that in the real estate business if you are a “flipper”, you’re you know buying it for whatever price and you’re doing maybe something or maybe nothing to it, and selling it so there’s many variations is as you can think of really in that, but for us specifically, we are buying, renovating it to a serious level. Our properties are beautiful, we’re obsessed about detail in every measure of process and data and KPI, whatever you want to talk about, we can go there and our acquisitions, construction, transactions and sales and marketing.
So it’s vitally important and it will make a massive impact. The turnkey component of that specifically is about what the exit is. And so we are talking to folks all over the United States and internationally, even many soldiers on the current military folks and a little shout out to ADPI, Active Duty Passive Income guys, they’re so awesome and helping people literally all over the world who are serving which is just awesome. So it’s a blessing for us as a company to help, working with them. So we help people who want to invest money.
We have clients who are blue-collar working as a police officer or firefighter, or working in trades or something, but they’re on the East Coast, West Coast, and they don’t know what to invest in, or it’s expensive, or they’re not finding something that they want, or they don’t have time to figure out all those things like, “How do we buy it? And what do we pay it for? And how do we renovate it?” So then we help them deploy capital in a great asset, and utilize this incredible interest rate environment that we have right now and utilize all the benefits that real estate has to offer. So I don’t know if I wrap that in a much more business-centric package there, but that’s what we do.

J:
So is it safe to say that basically what you’re doing is equivalent to a flipping business, except that your exit strategy and your end customer, as opposed to being a homeowner, a retail buyer is going to be somebody that wants to buy the property to hold long-term for cash flow. So basically, you are flipping but you’re reselling to a landlord who’s going to hold the property and keep it under management?

Nathan:
Yeah, exactly. So first of all, you’ve hit on the exit. So we’re thinking about really we serve two clients in this transaction if you will, one is purchasing it and one is going to call it home. So we have to be thoughtful on both of those people. And so unlike when you watch on HGTV and you see some … Which I don’t watch by the way, I can’t watch it like a cop watching cops, but I live it during the day, I don’t need it during the night.
Anyway, so the exit, we’re thinking about, “Okay, as an investor, what are those components that are important to you? And how are you going to be thinking about this? Can you give me what the scope of work was? And what’s the condition of the roof or what did you do on the bathroom? Does it have new plumbing? Did you take out a permit if it’s necessary?” So we’re solving it for them and does it make mathematical sense as a quality investment, and as you’re deploying your capital, and you’re thinking about growing your wealth, and that’s our mission by the way, it’s literally building a bridge to wealth and freedom through real estate and that’s our target. That’s our niche, and how we help people do that.
And so then the second is the tenant, right? So we want to think about, “Hey, mama shows up and she’s singing about, hey, I like the kitchen for having the birthday party or dad’s like, hey, I’m out in the back throwing a barbecue, having the family over or whatever.” And, of course, anybody can make those decisions. I just made it as an example but the point being, we want it to be beautiful, but we also want it to be as tenant-proof as possible. So when somebody moves in there, we can reduce the cost, we can have as little as possible cost and turns and also keep people there as long as possible.
If we pick houses that have jacked up layouts or weird things about it, it might look good on paper, but you keep having that turnover because people move in and people don’t like living there. So we really try to take both of those things into account.

J:
So let’s talk about how your business is set up. I know in my flipping business, and obviously, we talked about the commonalities and flipping, but there’s also places where it’s very different. Our businesses basically, Carol and my businesses basically, we have acquisitions, we have the rehab piece, we have the sales piece, and then we have the raising money, the financing piece. Do you structure business similarly to that? Do you have additional pieces? Do you not have some pieces? What does the internal structure of your business look like?

Nathan:
Yup, great question. And you guys have beautiful rehabs too and it’s awesome watching somebody operate like that. And I think it’s easy to just pass over like, “Hey, this is actually … It’s simple, but not easy.” Right? And you can do that and doing it at scales is a whole another animal. So our business, we have I think it’s four, I say four before I tell you that what they are, but we have acquisitions, transactions, construction and sales marketing. So four, I got it, right. Okay. And I guess finance would be five so nevermind, I got it wrong, but I’m not good with math anyway.
So the departments themselves have evolved over time and I think are you going after the management and structure of this thing? Is that where you’re thinking? Cool. So for us early on, it was we’re buying houses, great. Nathan go buy houses and I’m a high D personality, I’m like, “Sweet, bang got a house.” No problem. I got it. So now, going from that cowboy approach to really systematizing and coming through and by the way, a lot of pain, a lot of learning and a lot of trying to understand, “Hey Nathan, you actually really are not good at this at all. And you should not be doing it by the way you are no longer allowed to do it, and you’re fired, and go do something else that you’re good at.”
So finding people who are really good at those processes, so onboarding of let’s say, acquisitions, how do we underwrite it? What is in our buy box? What would we buy? What numbers as far as our rate of return? What is the cap rate for that investor? How long is it going to take us? What is the cost of renovation? So there’s a lot of details that becomes very pertinent as you look at it and can look at the lag indicators of what the performance of these things over time. And then in our transactions, my business partners helped raise a lot of money.
So we operate with a lot of private money which is awesome. And so it’s very streamlined at this point within our Podio which is basically an open architecture. For people who are not familiar, you can literally take any data point, name, address, phone number, amount, date, whatever. So a lot of that stuff’s already using a thing called GlobiFlow, it’s automated. So whether it’s ordering title, or ordering insurance, or scheduling a closing or even almost to the point of sending out contracts, and all that stuff, everything automated, but ordering that lender money, tying it up with the title company, making sure the contracts all together. So there’s a lot of components and I don’t know how far deep down that rabbit hole you want to go, but those are the departments of our company.

Carol:
Awesome. Thank you for giving us that structure and painting that picture of what the whole overall organization looks like, that’s really helpful. So I’m curious Nathan to move this discussion even further beyond the real estate world and to make it even more applicable to anybody who’s starting a business or owning a business, and looking to serve the different types of customers. Like you mentioned for example, you’re really serving to customers, you’re serving the landlords, these people who are purchasing the houses and the people who are eventually going to be the tenants, right?
And there are some different needs and wants and wishlists among those people. So that’s point number one. And then you mentioned that you’re very detail-oriented, and data driven in every single aspect of your decision making for all of these components of your properties, right? So my question to you is how would you recommend other business owners go about the process of really full-on building those systems and processes so that we can really ultimately serve our different customers in the way that makes the most sense for everybody?

Nathan:
Yup, great question. So data-driven, and process-driven is not by nature for me. And I think a lot of people out there and if you follow DISC profile, or the PI, Predictive Index or Culture Index, or whatever, you can see over and over this visionary personality type, and then the book Traction is great, it talks about an integrator and a visionary. And they wrote a second book called Rocket Fuel which describes further in-depth that relationship. And so I sit firmly in that visionary seat, 10 new ideas or really 1,000 new ideas a week, almost all of them stink. And what happens is you don’t have a platform or a person or process to funnel that stuff. And so you just create as my business partner calls, I’m Professor Chaos. I’m just constantly putting stuff in that system.
And so over time, I’ve had to learn first of all, who is good at building those processes, what are the really important numbers that we can suss out and that’s me sitting in the CEO seat, what can I suss it down to a few important numbers, but it doesn’t mean that the data set isn’t huge, it just means that we are able to take all that data and pull it down into something that’s really meaningful. And so I think if somebody is really starting to think about that right now, whatever size businesses, we have 15 employees, it might be big, it might be small to you, but if you’re having these challenges, you have to start just applying 80/20 principle.
And if you haven’t done it in at any department, you start with just what’s the biggest problem? Where do we need to identify this? In our business, it was in construction, it’s a huge problem. It’s a lot of moving parts, millions and millions of dollars on the streets all the time. And so how do we single out problem after problem after problem which is I like problems, right? We just want better problems, and we solved that problem, we want a better problem. So that’s fine. We want problems. But somebody like me who says, “Hey guys, I don’t understand why are we not closing this deal on time?”
So that’s not a process-driven question, but we can come at it with a process-driven solution or answer which is, “okay, well, let’s look at the number of days under renovation. Let’s look at the number of problems and inspection items. Let’s look at which contractor was on that job.” We can start to back into those questions and recognize that at the end of the day, here’s the other thing that terrifies me and is a wonderful opportunity which is from a process standpoint, do you need that process? What is most important and are you running something that actually is making a difference?
And knowing the difference in that in your business where people have autonomy, they need to run something or you, having focus, having a process that gives you the dimensions to live in and operate within, but also being able to have somebody actually go and do that job as opposed to you just sticking there and trying to automaton the thing that you want to do that’s being done by a person.

Carol:
Excellent. And to follow up even more, I think there are so many nuggets, but there’s one I want to hone in on a little bit more. You mentioned really think about do we really need a process for this particular item, right? I feel like myself included, a lot of new business owners and a lot of even seasoned business owners, we become so bogged down with so many things going on all the time, so many fires, so many opportunities, so many challenges that you become really overwhelmed when it comes time to really make a concerted effort to develop these systems and processes.
So I really love especially what you said about taking a good hard look at do we really need an explicit process or system for each one of these areas? So and you mentioned also, really applying the 80/20 principle. Can you talk to us a little bit more about that?

Nathan:
Absolutely. Yeah. So I wrote down how to focus and again, that’s such a problem, right? Because anybody that’s excited about something, that’s the wonderful thing about entrepreneurship and that’s the most horrible thing about entrepreneurship because you can do anything. And of course, if you sit in the entrepreneur, hustle, grind, whatever, nobody can tell you otherwise that you should or shouldn’t do that. So I think first of all like in our business, we had to come back and say, what are we doing this year? What is our goal in five years? We’re going to own this many units.
Okay, well, over the next five years, what do we have to do, and now we backtrack into that. Okay. And again, back to the book Traction, and they have a thing called the vision traction organizer which lays out all the things from literally who we are, what our core values are which is something we spend a ton of time on. And we’re looking through the lens of that, what is our organization? How are we going to operate? What’s our mission? Okay, great. Five years from now, this is what our Big Hairy Audacious Goal is. All right?
So if that’s our goal in five years, then what are we going to do in three years? And what are we going to do in year one? And now we have to backtrack by quarter and say, “Okay, well, in order to hit that this year, we’re going to track it by rocks.” And this comes back to that data analysis and process and be able to say, “All right, where are we in regards to this idea?” And then if we’re going to put an idea on the board, we attack it. And we take that iron sharpens iron approach, and we say, “All right Nathan, you have a million ideas. Is this a good one? Is this losing focus? Are we still on the same thing? Have we accomplished the goal that we already set out? By the way, you better identify one because everything is nothing. And the one thing is everything, right? We cannot make choices every day to focus on something else because you just can’t simply do that. A rifle has one bullet. You can’t pull the trigger, and aim at everything, you just can’t.”
This is a nightmare for a visionary to say, I can’t believe I hate these words even coming out of my mouth because J, Carol, I have so many ideas. And I want to do everything and it’s just so fun. And you know what? My team, they’re like, “Nathan, this is great, but you’re really causing anxiety and a nightmare.” So guess what? I work out all the time, I have a meditation practice that I’ve worked on, I have journaling in my life on a regular basis. I take notes, and I shut up when I have ideas and let my team operate.
And so when we have ideas, it’s great. But we need to have a platform and somebody who’s a process-driven thinker, data thinker, to come back and work through those things with us. So we can really identify what’s a great idea, what’s a good idea, what should be put on the whiteboard like I do in my office, I have a 4×8 whiteboard. If it’s an idea, that’s good and it’s standing the test of time, it lives on the whiteboard, and then eventually becomes a thing. And if it stinks, it eventually gets wiped off and in place something else. So I’m super passionate about this topic.

J:
I love this and you’ve … The discussion we’ve had, I feel like I can take this in 20 different directions. We can talk about hiring at this point. We can talk about KPIs, we can talk about your CRM system, raising money, acquisitions, we’ve hit on so many things. So I’m going to have to pick from these and head in a direction. We’ll hit on a bunch of things. But let’s start with KPIs. And for those listening, KPIs are Key Performance Indicators, they’re the things we measure in our business. And a lot of times we just refer to them as metrics, but if you have to apply a fancy word, KPI is the fancy acronym we apply.
As real estate investors, KPIs are important. As business owners, KPIs are super important. So can you talk to us a little bit about how you use KPIs in your business, how you define them and again, if for our real estate investor listeners, this will be directly applicable for our business owner, not real estate investor listeners, still very applicable. Talk to us about how you derive the KPIs that you’re going to use, how you track them, how you review them with your team, what’s your process around KPIs?

Nathan:
Okay, great question. Again, I’ll use this caveat to say that I have grown to love KPIs. I just don’t love trying to figure them out. So it’s not my gift. It’s not someplace I find joy, it’s like a life-sucking source for me. And so I want people to understand you don’t have to love figuring out that stuff, you just have to start understanding why it’s important and how you apply it. So for me, it became … There’s a lot of evolutions of it. And what’s interesting about KPI is that it’s literally just a data point.
So if you have something that you can track, a spreadsheet is probably … Well, on a Notepad is probably the worst case scenario, but Google Sheet, next level and then Podio now for us. Between QuickBooks and Podio, we can literally basically track anything and pull any data that we want.

J:
And just to step back real quick because you mentioned Podio twice, but I have a feeling that there’s going to be a number of people in our audience that have no idea what Podio is and what it offers. Can you give us before you go on, talk to us a little bit about what Podio is?

Nathan:
Yeah, absolutely. So it’s like an open architecture thing that you can literally put data, you could chat clients, you can send mailers out, we use it to, I think I maybe even mentioned this earlier, order title, you could track cost of goods sold, we can track the number of houses that we have pending for the month or the week or the day, or we can track literally any data point that you put in there, you can track it or manipulate it or look at it or whatever. So it’s just a 32nd overview Reader’s Digest version.
So in our business, when an idea which is the beginning which is a lead potential house, it goes into Podio and within about 30 seconds, 60 seconds, it spits out a couple numbers that tell us how possible would this deal work? Would it work for us as a buyer? Would it work for pricing for the tenant? Would it work for our clients, right? So boom. And then now we create that into a listing and that listing tells us, “Hey, the transaction coordinator can make notes here and say who the title company is, and what’s their contact information? And, by the way, when the buyer buys this, here’s their contact information and the closing date.” And so on and on and on and on.
So that literally runs all the way through the sales and closing, including construction, who the manager is, who’s the contractor on the job. So we can literally track anything, and then pull back to that data so.

J:
So it’s basically an open architecture database that you can customize to track whatever types of information your business that might be important. So if you have a real estate business obviously tracking all the stuff related to your real estate transactions, but it could relate to any business and it’s basically just a way to track the metrics and the data in your business.

Nathan:
Yup, yup, exactly. And it’s a wonderful thing and it’s definitely evolved over the years for sure for us. But so I think coming back to the question of KPIs, so we’re saying what are they and how do we make them important, is that [crosstalk 00:28:33]

J:
And how do you track them and review them and use them in your business?

Nathan:
So for us, we take it a number of different ways. So we can go as microcosmic as looking our acquisitions department, or you could apply this to any business, somebody who’s picking up the phone and making a phone call, right? So if your outbound sales, we’re looking for houses to buy, right? But whatever that widget is, you want to talk to somebody. So that’s step one, right? We need a lead, we need somebody who wants to do something.
Second, was an opportunity. Did we aim a fire at that? So in our business, that’s write a contract and then number three in the sexiest of all those babies is putting that sucker under contract, right? So we want to buy … We want to put 400 contracts a week in our business because we also know based on KPIs in our data what our fallout rate is, say percent. So we know in order to hit our goal, coming back to that vision, traction, organizer, how many deals we’re going to do for the year, quarterly rocks all the way back, boom, now we’re back to our KPIs that tell us are we on or off track. So that’s within acquisitions, I’ll give you a little bit higher level.
So like for instance, within our construction department morning huddle, so we do morning huddle in all the departments, construction, acquisitions, construction, talk about like, “All right, these are the ones that are closing this month.” Right? And we need to sign off this many houses which is complete the renovations to deliver these on time, quality and budget to our transactions department so they can close them, right? So that client can buy them, that tenant can move into them. And if those things are off track, then man, you have a problem with the title company who’s expecting to close it, you have a problem with the lender who has a rate lock on that property, and they are expecting to close it or there’s additional costs or trouble there.
So then we can come out a further away. So we use it within our advisory team and say, “Hey, this is the financial performance of our company for this week, this month, this quarter. This is what happened, this is the challenge.” We can see because looking back, we know how long it’s taking us to close or run construction or whatever so we can look forward then to say, “Hey, if we hit our averages, this is where we’re going to be at.” And then we can also communicate that to our team. And each person like, “Hey, what are you responsible for?” In sales, it’s their sales guys, how many houses did you sell? Transactions. Did we close everything on time? Construction, did we get it on time, quality and budget? Sales and marketing, what is the impact in our Facebook, or Instagram or whatever.
So we can look back out as big or small macro or micro and be able to say, “Hey, individuals are responsible for their individual numbers. But then as a collective, we’re responsible for our ultimate few numbers which is our profit and gross profit, revenue, and net profit of course which is the most important number in any business from the financial perspective.”

J:
I love this. And it sounds like you are using KPIs in basically two ways. One, it’s allowing you to set the targets in your business. So basically, you know that if the people that are calling on houses, let’s say you’re doing cold calling for every 100 calls they make, maybe they’re going to get 15 people that that say, “Hey yeah, come take a look at the house.” And for those 15 people, maybe you’re going to get eight that you write a contract on and of those eight, maybe you get one that you actually close.
So now you know because you’re tracking those metrics, you know that you need to make 100 phone calls to get to that one sale. And if you want to do 100 houses this year, then you need to make 100 times 110,000 phone calls to hit your target of getting 100 houses. So number one, you’re using KPIs to help you set those targets, and define what people in your business need to be doing in order for your business to grow and get to where it needs to be. And then number two, you’re using KPIs to track whether people are actually doing that.
So going back and saying, “Okay, Joe Smith who’s sitting at the phones, he made 100 calls or 500 calls last month. In theory, he should have gotten five deals out of that. But we only got two deals out of that. So maybe whatever the processes are around our calls, Joe’s not doing it correctly, or optimally because he didn’t get five deals, he only got two deals. So what could he be doing differently to get his numbers and his metrics up?” Do I have that right?

Nathan:
100%, 100% and that’s almost that premium lagging and leading indicator kind of question I think is what you’re getting after. And you’re very analytical brain unlike mine, but I think it’s the simplicity and complexity of it all at the same time. Just like, “J, did you make your phone calls? Carol, did you make the sales calls? Or did you call the title company on this deal?” But at the same time, what’s interesting and J and I were debating on this, chatting about it. But I told him that the unbelievable amount of time and attention in our construction department will literally lead to a seven figure, additional revenue to the bottom line if we hit all our targets, all our metrics.
And by the way, our team will benefit from that, our business will benefit from that, our clients will benefit from that just in our performance and the product we’re delivering. And of course, as a business, we want to be successful, and always including financial. So and that’s literally from time after time obsessing. Did we set the target? So I wrote down set targets and understand what happened and then did people do that? And that’s what you said J, and then literally dissecting it, training on it and then lo and behold, let’s go back to the question we were talking about before, process.
So then where did we screw up? Where is the process missing? What do we have to obsess about now? And then guess what? Back to focus, what’s the big problem? What’s the little problem? What’s the big problem? What’s the little problem and we get to go back and forth and that’s the thing is that as a business owner, sometimes you are more in the weeds than you want to be, but you want to as quickly as possible get back out of the weeds and encourage, elevate and give the people on your team the opportunity to solve these problems and our COO in our business and our sales and marketing director in our business and my business partner all bring different things.
And so we say, “Team, this is a problem, what are we going to do about it?” And we can approach and utilize our geniuses and our gifts and not trying to, we can row in the same direction, but utilize our different gifts as we solve those problems.

Carol:
I love this. I really love this. And I think it’s really powerful how you as the CEO of your company talk very directly about allowing the other team members, not only allowing them, enabling them and expecting them to and giving them the opportunity to become problem solvers, to establish best practices, to figure out the next best direction for whether it be a long-term goal for the company, or smaller components within achieving those goals.
So I would love to talk even more about building that culture and the best practices around it, right? So you mentioned all these things about communicating regularly with all of your team members about their roles, their goals, impacts and their metrics. You talked about how you’re always keeping and moving ideas around on the whiteboard, rather than just saying, we’re doing this, we’re doing this, you have a different process and practice around staying focused and making sure everybody is looking toward the same goal. You talked about morning huddles, all of those great things.
So what are some of the things Nathan that you employ in your business that you would consider best practices that maybe to you, after all this time of growth, or just what you do, you may not even necessarily see it as a big light bulb moment anymore. But to other people, these are really, really helpful things, these great nuggets that we might be able to employ in our businesses to keep us moving forward.

Nathan:
Man, I’ve screwed up so many things. So there’s so many opportunities to talk about these problems. So this could be its own show, guys. But I wrote down a few things. And I’ll start with the story, and I’ll be as brief as possible. So I was at a mastermind event, and I was reading I think at the time, I’m an avid reader and I think it was Extreme Ownership by Jocko Willink and I remember the line which he’s of course written a follow up book Dichotomy of Leadership which then dissects this idea, but there’s no bad teams, only bad leaders. And they give a story about two boat crews obsessed about Navy SEALs, but two boat crews. Well, one captain is doing a good job, one captain is blaming everybody else. And guess who’s winning? The guy that’s helping lead and guess who keeps losing? The guy that complains and doesn’t take any responsibility.
And it was just a gut punch and in that story, now they flip flop captains and they’re like, “Hey Boat Crew One, move over to Boat Crew Two. Boat Crew Two …” And so forth and get lo and behold, guess who is now competing and winning? The same boat crew that was stinking and losing. And so I’m so passionate about this Carol. So I’m excited for this question. I hope I don’t go on forever. But I came home and I sat my team down, I was like, “Hey, I’m going to tell you something. I totally, totally blown it. I have completely failed you guys. I’m not focused, I’m emotionally pissed off sometimes. I’m not connected, or I don’t communicate this in a way that’s healthy, or it’s solving the problems. And guess what? Owning and running a business is hard. Everybody wants to own a business and whatever and they don’t think about all the things that go into it. And especially once you have people on your team, I take it seriously. And if we’re going take the responsibility of having somebody on our team, we had to start realizing what that actually meant.”
And so all these things have been bucket after bucket between culture core value, training, onboarding, process, defend the castle, what does it look like when we interview somebody? What is that process? Oh gosh, we’re back to process. Can we get rid of it? No. So you I’ll start with culture. So we try to do traction and implement traction a couple times in our business, EOS, Entrepreneurs Operating System a couple times, and we ended up hiring a coach to help us. God forbid, somebody, Nathan, we’re doing tens of millions of dollars a year. Yeah, I have a coach, I have multiple coaches, and multiple masterminds, they spend a lot of money on that, it’s important. We all need to coach, we all need to be coaching. It’s both end problem.
So leadership, integrity, generosity, and drive, those are our core values and core values come from the visionary of the company. They are not just some idea, they are you as the entrepreneur. And we often can look at these things and wonder like, “Hey, where did these things come from? Or what’s important?” And when you start to realize having people on your team that are not in culture. So let’s say I was in a call today and the guy, literally his only job is, well, maybe not only, but he lives and breathes, understanding how to build teams and culture and 12% was the regularity at which resume showed the job performance and if they would succeed, 12%. That’s insane. So think about when you look at that resume and I’m trying to remember …

J:
Can you expand on that? What do you mean by 12%?

Nathan:
Yeah. So as a predictor of their success in their job, only 12% of the time was the resume the actual predictor of success with the person. So hey, J, you can swing a hammer and go do that, great, I’m going to put you in that job. The number one predictor of success was the cognitive ability to understand what was happening when they’re learning something new and number two was drive. And so in our business, leadership, integrity, generosity, and drive, we had to find people that had and shared those values, they valued those things, and that they would be on the same team rowing in the same direction like Jim Collins says, right? Everybody, the leadership, level five leadership, people in the right seats go in the right direction, integrators on that, the team is seeing that brake and gas.
And so we had to slow down, understand who we were first and then we could start slowly getting people who are a little bit better quality, and gosh, somebody who’s listening who used to work for me or something, don’t think that I don’t value you as a person, but we did better at finding people who are in our tribe. And so as we find people who are better in our tribe, guess what? Lo and behold, you also attract people who do other stuff better than you. Just like we’re talking about music, You want to play in a band, I want to play with the best players possible. I don’t want to be the best player in the band, I want to have the best people I can get.
And so oh gosh, guess what happens? In training, now we have people that we identified that were on our team who say, “Hey Nathan, the onboarding process here, it’s sucks. You know why? Because there is none.” Right? So now what do we do? Well, in core value, that’s leadership. In core value, that’s drive. We’re integrity to say, “Hey, we don’t know what we’re doing and we’re going to name that thing.” And by the way, generosity, I’m going to spend all Saturday, all Sunday, all Monday, all Tuesday the next week to figure this problem out, exits that important. And so how do we do that? Well, it’s somebody that we brought into organization that by the way, I cannot figure that out because I’m not that smart. But she can because she’s done it. And now we have a template for onboarding and guess what’s in that template? It’s a process. There we are about what are all the things that person needs to learn. Okay? Now we can have a training opportunity.
Now we identify who’s the person who’s going to do that training. First, let me show you, then let’s do it together, then you do it and show me and then guess what? We can sign off on that problem, sign off on that thing. And we can say you are trained in having that autonomy and having that drive is part of about being on the bridge team, right? We want people who are self-motivated. And so all that stuff together creates the culture and then moves it forward and it’s not one moment of like here’s culture, and then here’s a core value. And we’re doing all this at the same time. But it’s this amalgamation of different microcosmic moments that change and move that forward that then propel the other thing forward. So anyway, I love this topic and I am super passionate, especially now seeing it unfold in my business in realtime.

J:
Wow, that was seven minutes of pure gold. I’m sitting here like frantically taking notes. And I know we asked for best practices, I figured you’d say, “Okay, let’s see, here’s one, here’s another.” I feel like you’ve … Well, obviously, you’ve really lived that. But that was just, you were ready to go there. So, so many amazing nuggets in those last seven minutes and I recommend anybody who’s listening to this, go back and listen to that. Go back and listen to that last seven minutes.

Carol:
Yeah, it was an excellent … I just have to interject and piggyback on what you just said. It’s an excellent lesson and deep dive in the right way to grow a culture that really thrives and pushes your business forward together. It was just very beautifully stated. So thank you for going as deep into it as you did because I think there are so many pieces in there that we can all use exponentially. It’s great.

J:
Yeah. So I want to touch on one that you hit tangentially. And that is employees and hiring. And I know that you’re very thoughtful in your hiring and it’s something that you and your team work hard at. So let’s pretend we have listeners out there who are getting ready to hire their first employee. And again, we could be talking about real estate and if we’re talking about real estate, maybe that’s a project manager, maybe that’s an acquisitions person, but it doesn’t have to be.
Give us some best practices and some of the ways that you ensure that hiring for your team is a win-win, and that you’re bringing on people that are a good fit and to use your words, finding people in your tribe.

Nathan:
Yeah, great question. And boy, oh man, people is the hardest part of business, there’s just no question about it. Other than if are like me and you are trying to do QuickBooks because one-third of your receipts would be in the back of your truck, one-third would be somewhere that I don’t know and then one-third would be here somewhere. But other than that, it’s definitely people. So first of all, I think if you’re thinking about hiring, or you have hired let’s say less than 10 people, go read the book, or you’ve hired 100 people, and you’re solving problems.
But E Myth is a great book and it tells a great story. And basically the synopsis is all of a sudden, you build a business, and you’re like, “Gosh, I need help. Who’s my first hire? Probably somebody like me, right? I want to hire accounting and an administrator.” And I’ve lived this story over and over and I read the book and I’m like, “Man, were they watching me? Have they seen me? Do they know me?” They just didn’t name my name in the book, but it’s like, “Hey, you hire somebody, but you don’t train them, you don’t understand. You don’t know what the processes are. And then you are upset and pissed off with the result.” And I did this over and over and over again. And it is a nightmare that won’t end and you don’t understand as an entrepreneur especially if you’re that visionary person because you’re flying high above the details, and you are not paying attention to it and it’s not something that you’re good at. And so of course, so we started using … Well, there’s a couple things.
I can’t remember what book it was, I want to say maybe it’s the Zappos book, Delivering Happiness which is a wonderful book. But thinking about what the pacing of that looks like, and it might not have been that book, but go read that one too, it’s good. But so we used to … In the perfect forum for me, visionary guy is like be at dinner, have a glass of wine. Carol, I think you are sweet as can be and your resume looks great and man, we are connected and boom, we’re in business. Game on. Gosh, oh man, not to say that I wouldn’t want to hire you, I’m sure you’re not available for that, but the fact of the matter is a man, my sales and marketing manager said, “Nathan, you like everybody.”
Like, “Don’t put him in an interview.” We had to slow down and we had to identify first … We’ll talk about the hiring process real quick and then we’ll talk about the job description. So I’m going to make a note here. So from the hiring process standpoint, at some point, I got to talk to him, but I just wanted to see if I felt the vibe, right? I want to just make sure I feel the vibe. And I’m going to enjoy this person because I’m a people person. And I want to make sure that they get the vision and they can dig that and other than that, we need people on our team. So we now have literally four or five job interviews before we hire somebody.

J:
This is so important. I really want to go back to this real quick. Too often in business, we feel like, it’s a lot like bringing in a tenant and you feel like, “Okay, we have these fair housing rules.” And if a tenant meets your qualifications, you have to bring them in legally. And so especially those of us in the real estate world, we tend to think, “Okay, do they meet the qualifications legally?” We can’t discriminate against them. Hiring in business is a little bit different and you just said, “Do you feel the vibe with this person?”
And I know so many people out there that would never consider that one of those things that they look at in hiring because they feel like that’s too subjective, it’s too discriminating against certain people if I don’t vibe with them, and I need to hire the best person for the job whether they fit with me, whether they fit with the team, but what you’re saying is it doesn’t matter if they’re necessarily the best person for their job. If they don’t fit with your vibe and with your team’s vibe and as you said, fit into the tribe, don’t hire them. Am I getting that right?

Nathan:
1,000%. Patrick Lencioni, one of his 7,000 books, five, whatever, whatever of a team, he talks about this story and you’re like, “Man, we went to the competition. We got the best sales guy ever, and he’s amazing.” But guess what? The dude is not in your culture. And so it doesn’t matter if … Well, back to that stat right? So resumes is a 12% predictor of success in the job and so it’s funny, I didn’t even catch talking about that vibe. But think about dating, you’re going to spend a lot of time with this person. Right? And you don’t have to be BFFs or anything, but you want to like them.
And being in business and being a business owner, it’s important obviously, knowing where the line is. And again, Jocko talks about this a ton in leadership. He did it in a bunch of his books and podcasts and stuff. So this is not my idea. But it’s crucially important, both get it, want it and the capacity to do it. And you have to have all those components and culture is definitely one and the cool part about the culture question and back to … Did we hit that J? [crosstalk 00:50:27]

J:
That was perfect. And I love the fact that I’m sitting here writing down all the books you’re mentioning because we have to add all these to the show notes. But Patrick Lencioni, the book is The Five Dysfunctions of a Team.

Nathan:
There you go. Thank you.

J:
Thank you.

Nathan:
So we don’t just go talk to somebody, look at a resume and hire him anymore. It just doesn’t happen. And so typically, we will have somebody who’s fairly detail-oriented who looks at all those applications and who come in and we use WizeHire which is great and it has a DISC profile attached with it. And if they can’t follow the directions, and put a resume and fill out a DISC profile, then they’re not going to fit for us. So step one, problem solved. And if you are applying for a new construction management position, and you currently are a assistant manager at Arby’s, you will also not qualify.
So we get a lot of that too. But it’s quick to weed them out, up or out as I say. So faster yes, faster no. It’s also important clearly said like a visionary. But so we do that, we do a quick strainer interview. Hey, let’s actually just talk about the position. Does this make sense? This is who we are, who are you? Did you maybe look at our website? Do you have an understanding who you’re referred by? Let’s just get an understanding, hey, this person might look like this works. If it’s in a management position, we’ll then have interview with the management team.
What does that look like? How would you fit in with this team? How do you deal with difficult situations? How would you work in this situation? Talk about the specific details of that job, then we would sometimes if it’s an upper end position, we also have our business coach interview them solo, and we get a recording of that, they send it to us and their notes on that. So it’s just a total third party person who has our back, but also is not in the day-to-day grind. So they can look at that. I have a conversation with them, culture fit. And like are we going to dig? Do we get the vibe? And then their department. So who’s in the department, who they’re going to work with every day, what’s that going to feel like, look like? These are the tightest touch points.
And so working through all those things, and then we can say, “Gosh, did we actually take our time and by the way, if this person really …” Yeah, when I say to defend the castle, I mean that seriously, I don’t want to go hire this position in six months, I want somebody who not only gets it once and has the capacity to do it, but is fired up to go do this job. And by the way, when we bring in another person that’s in that department, they are going to want to do that as badly, or more so than the people that interviewed them and put them through a freaking gauntlet to make sure that we got the person on the team that really wants to be there. It’s vital. And so when you go back and you say, “Okay, well, how do we make sure we get the right candidate in the first place?”
Well, did you have a clear job description? Is it obvious what the job is? And so you write through what is it that they would do, what are the qualifications and then anything else, it’s important. This person is driven, obsessed all the time to do it, right? Or very good in data and loves small details. We try to make it as obvious as possible what the person would be doing and what success looks like and then we match that with the PI, the Predictive Index, and those guys get lots of money for this tool, but it’s amazing. And so we use it and we actually take the language of the personality profile of that person, and we take it and we paste it in the job description.
So guess what? When somebody, here’s the language about like, “Oh my gosh, I love to design furniture and lay out a room.” High detail person that loves design and working on their own. Right? We’re going put that sucker right into that job description so we are attracting people who would do good, do a good job with it and we are repelling the people who would not like that and doesn’t fit in that like it love it box. So it’s been kind of a two-fold process as we’ve started to get a lot better I would say at the interviewing and onboarding.

J:
Yeah, and one of the things that you implied that I really believe in and I’m a firm believer in and I spent much of my career at Microsoft, and this was a very important hiring concept at that company which is don’t settle. We used to have a thing where if you would be interviewed by eight or 10 people, and then you could absolutely be interviewed by eight or 10 or 15 people over the course of several interviews at that company. If a single person says no, it’s a no, and it’s not democracy. It’s not, “Hey, we need five out of seven to say yes.”
If somebody has reservations, it’s probably not a good fit and it’s better to wait for somebody that’s going to get unanimous agreement amongst the team members than it is to fill a warm body in a seat because if you put a warm body in a seat just because you really need somebody, they’re going to end up costing more time, more money, more effort, more frustration than not having somebody at all.

Nathan:
Plus, it gives your team an opportunity to have a voice too which is huge.

J:
Yeah.

Carol:
I’m curious, I wanted to follow up on that point a bit more about all the different personalities on your team and everything and the hiring process and bringing new people in. I’m curious, a business of your size, of your magnitude of having all of these different types of roles necessary to keep your company thriving. Are you finding that your new hires are typically in the real estate space before they come to you or are you finding a lot of good fits outside of your industry as well? Just talk to us more about that.

Nathan:
[crosstalk 00:55:59] great question. Somebody in a new construction manager or project manager, we found that somebody that has some more experience has been helpful at times, but it’s the old dog new tricks too and also, did we get our process and those sort of things clear? As far as the other things whether it’s in acquisitions and transactions, or cells, we’ve had a lot of non-real estate people. And I think that’s again, back to that culture in clear job description and then more and more and more and more and more I find that it’s less about were you an acquisitions agent and what are you like? What is your curiosity? Do you want to do this? What is your natural bend? Did you spend me multiple years working in Best Buy in high school for 12 bucks an hour or whatever it was, and they silently turn you into a sales assassin, and you don’t even realize it?
And then you wake up one day, and you’re like, “Man, that’s what all those awful Saturday morning stupid meetings and role playing was about? Oh, dang.” So to me, it’s like if we can find somebody that really wants to get after it. And that it makes sense, or that we can coach people up too, right? So that’s the other thing is that it’s a constant thing. And I tell my team this all the time, “I expect me, myself to earn my seat every day and I expect you to earn your seat every day. It’s a both end problem. And so the person that you were hired on March 4 or whatever, I expect you to be better today, better at the team and better at your job. And not just in a selfish for me way, but in a selfish for your team. Right? You’re getting after it to get better as a team and operate so.”

Carol:
And I wanted to say too J, and Nathan, I think it’s one of those cool things that I think a lot of us we take this whole, I don’t want to say we take this real estate investing profession for granted. But the nice thing about when we’re talking about going outside of the space to bring new people in, you’ve got to love that real estate investing has become such a thing, because of course, people think it’s such a big glamorous thing. They don’t realize what the reality of it is. But I think I would expect in our experience, and maybe with you too, it just helps draw your pool of applicants, right? Because they look at Bridge Turnkey Investments is this awesomely, thriving real estate investing company, and they want to get in on the action. Right?
So I just think that it’s just a great reminder to all of us out there who are in this space in these opportunities we create for people that they really enjoy.

Nathan:
Yeah, it’s a huge impact. And I think the other thing about that is for me personally in my gifts was like, “How did I communicate and tell the story?” I got lucky, got on BiggerPockets early when it was not nearly as big as it is. And so for instance, literally a year and a half ago, or so we launched a meetup in KC and literally took over, this was the largest real estate meetup in like four months. And it was just one of those things that just blew up and that you almost … Just shy of 9,000 people on the Facebook page at this point and 20,000 some posts a day, it’s just ridiculous. The amount of activity in there, I might have stated that wrong, but it’s a lot. I’m not the data guy. So forgive me for whatever I just said, ignore the numbers.
But it grew fast and it’s gotten a lot of attention. And the cool part about that is it definitely has funneled people who maybe would not have seen our company before so it gives that attention as well as man, it’s really hard to get it right and it’s really easy to screw stuff up. And so it also puts a big target on your back as a business and as a human. And so to make sure like, “Hey, we’re living up to whatever this thing is that has now gone far beyond Nathan Brooks of Bridge Turnkey.” It’s its own animal and it’s its own thing so it’s a big undertaking to also manage that.

J:
That’s awesome. Before we get into the four more segment of the show, I do want to take advantage of the fact that we have you here with us and we have a very large real estate audience. So we’ve spent most of this episode talking about general business topics and growing a business. But I would like to talk about two more specific real estate topics for those real estate investors who are listening that are excited to have somebody that’s doing 500 deals in five years with us. I’d love to talk about one, where you’re finding deals, what your acquisition, your best acquisition strategies are today and we know that with COVID, and things that have changed over the last year, that might be different than where it was even a few months ago.
And number two, how do you finance your deals? What’s your primary method of financing your business or your individual deals? Do you do syndications? Do you raise private money? Do you raise bank money? What do you do there? So again, just recap. Where are you finding your deals? And where are you finding your money?

Nathan:
Awesome. So finding deals. What a nightmare. We’re in KC, right? And I’m going to actually give some world news that’s not out there anywhere in the world currently. So it’s like for real most, today’s the day, this moment is the moment here, 1:49 Central Time, but we both used it to expand in a segment as well as market, as well as get better at just buying stuff. So first, we have branched in a new construction which we thought we would start building middle of last year, or something.
I think we thought we would have one house on the ground by like September of ’19 and I think we delivered our first house a year later, or something like that. But this year, we’ll probably put somewhere around 20, 22 houses on the ground in year one, new construction. And also, we’re literally launching this today on a webinar for Bridge. So we have moved into the Tulsa market, if we hit our target, we’ll put about 40 houses on the ground, new construction in Tulsa next year. And by the way, that 500 number is going to get blown out of the water when we add year six because we’re going to put like 300 houses on the ground between new construction and renovation in 2021. So that’s happening.

J:
Wow, congratulations.

Nathan:
Thank you. New construction, underwriting lots and having, so that’s just created another segment for us. So it’s a little bit larger profit margin per deal, more expensive too, but it takes a little longer, but it has been another profit center. But finding deals, this is going to sound maybe too simple, but it comes down to doing the work and relationships. Ultimately, at the end of the day, you have to actually do the work. You can’t will it unless you’re Yoda or whatever. You’re not going to bring it in without having … I’m a big Star Wars fan, but man, I don’t have those superpowers. So my superpower is do the work.
And so what does that mean? It’s wholesalers, it’s realtors, it’s people that you know, and it’s literally not like, “Yo, send me some deals.” That does not help, DM me man. It just drives me bonkers when I have the meetup. And so I get to watch this all the time or I got this house in this one place, that’s right by this one street. Call me, hit me up. I got it. It’s good deal. It drives me crazy. Anyway. So how about I am Nathan, I am an acquisitions for Bridge Turnkey, we buy houses typically between 100,000 and 160,000 ARV. We typically spend 30 to 35,000 in construction per project. So we need to have room to actually do a full renovation on this property because we care and we do a good job.
We’re quick, we’re cash, we’re professional, yada-yada. And guess what? All those things, we see those on signs and whatever. But then you have to actually show the people what you can do. And so we have the conversation. And if you are not that, if you are not the cash guy, and you’re actually like, “Hey, I got one private lender, and he isn’t on 50/50.” Say that, “I’m new. I’m not sure what I’m doing. By the way, this is my mentor, Carol, she’s helping me making sure I don’t do something stupid.” So I love having transparency and whatever the goal is. And so we online or on Facebook or in our meetup or whatever, we’ll say, “Hey, we’re buying four or five houses.” I see other people post that, I know they’re not buying that many houses. But so we’re in integrity with what we’re saying.
We are consistent with our message and we are relentless with follow up and building relationships. And so it’s really not about the deal, it’s about the relationship. And so when you come back to that, and you say, “Okay, back to the early conversation we’re having in process, we track every day our acquisitions people and this actually just … This change just happened and it implemented probably within the last month or six weeks.” So we weren’t really tracking with that because guess who was in acquisitions management? This guy, hopefully soon that will change and thank goodness, my business partner is in there now helping and lo and behold, we’re hitting our numbers, right? So what a crazy idea.
Entrepreneurs, visionaries, get out of the management and detail, it is a nightmare, right? And you were not meant to do that job. But you also have to do it until you can’t and don’t have to. So for us, it’s been clear on the buy box, I coach my team all the time. Faster yes, faster no, time to target, let’s be first. Let’s let’s buy every deal that we can buy, let’s tell them why it’s better working with us and it is. And by the way, this is our process or this is our … Dania, our transactions person or this is what’s going to happen with this house. And by the way, we’re not wholesaling it to five other people or putting it, chain contracting it, we’re actually taking the risk of putting this house down under contract, funding it and renovating it and selling it to a client who actually really cares and we’re going to make sure we get a great tenant who wants to make this place home. So we just tell the whole story and we can be honest and transparent.

J:
And the most important thing is, and I just want to highlight this because this is so so important when it comes to finding deals, it doesn’t matter if you’re using direct mail, it doesn’t matter if you’re cold calling, it doesn’t matter if you’re using bandit signs, if you’re going off the MLS, it doesn’t matter what the specific strategy is, make sure you’re working hard because all of those strategies can work if you’re willing to put in the time and the effort and work smart. And so I loved your point about you’ve got to work hard. There’s no magic bullet.

Nathan:
Nope, simple but not easy. And I will mention over the 500 or so houses which is not a scientifically proven number, but it is in that range to be clear that we’ve done over the last five years or so including vast majority of those last two years. We don’t really have a direct seller business. So people out there who are like, “Man, I can’t find a deal on the MLS or I can’t find a deal from wholesale or whatever.” You’re wrong. You have to just figure out what is the actual problem and don’t make money the problem or the wholesale the problem or whatever, make the problem, the problem, what is it that we need to do to actually solve this problem? So number two, financing deals, I think it was the second week of actual lockdown at COVID, the full-blown panic situation.
We got four phone calls from four different banks, 1 million refinance approved, another million dollar refinance approved, a $3 million guidance line and another $3 million guidance line. Now, it’s like the five years to overnight success as my business partner says, and it was like that, all of a sudden, boom. We had all this bank money, millions and millions of dollars, but for the last five years, we couldn’t find anybody that thought that we were worthwhile investing at least at that level. But over that time, it forced us to get really good at raising private money. So we pay a fair solid return and we have a really, really simple process for those people, they can use their IRA money, they can use regular cash, whatever.
So we had raised a bunch of money, and consistently paid those investors all the time and consistently made sure that we were taking care of our people. And so that over the course of time has just paid dividends both for our investors that buy houses, as well as the folks who have been lending as well.

J:
And have you found that COVID has made your financing piece more difficult or easier? Just given all the different conditions out there.

Nathan:
There was about two or three weeks there that were pretty awful from the standpoint of the clients specifically, people were uncomfortable under contract, but really from the financing, I think it’s been a bigger challenge with the interest rate and the refinance market and just getting people to get them done, having appraisers in, properties that are occupied has been a challenge. Finding deals in Kansas City is the eighth highest appreciating market the second quarter of 2020 which is bonkers why KC would be there.
We have 1.3 months of inventory on the MLS which is also bonkers. I think it’s what? Four to six months is a healthy balance. So it’s really incredibly difficult market specifically in the buying. I think the finding deals, the lending and financing really has not been a challenge up to this point, not to say that it couldn’t be a challenge in the future. But for us, since we controlled our destiny on the lending side and we had built relationships there instead of just having some hard money lender that had some specific amount or deals or whatever really gives us an advantage. And we can tell that story back to that building relationships and buying deals, you can tell that same story. “Hey, we can close.”

J:
That’s awesome. I could talk to you for another two hours about all this stuff, but we are running long on this show. So I want to jump into the final segment of the show, the segment we call Four More where Carol and I ask you the same four questions that we ask all of our guests and then the more part of the Four More where you tell our listeners where they can find out more about you and your business. Does that sound good?

Nathan:
Sounds great.

J:
Okay. I will take question number one. So Nathan, what was your very first or your very worst job and what lessons did you take from it that you’re still using today?

Nathan:
Oh man, I’ve had so many of those jobs whether it was making pizzas at Godfather’s, running as the busboy at a mafia-run Italian restaurant. Gosh, working at a dive place in Maryland for summer, running the bar landscaping businessman, man, I’ve done a ton of stuff over the years and I think the bottom line is having fun finding yourself and I’m not really a negative person. And my parents have told a story of I was in super trouble as a kid and that they’re like, “Why aren’t you upset?”
And they’re like, “Just because I did something wrong doesn’t mean I can’t be happy.” And just having for me, it’s been that positivity, and making the decision that whatever that job is like, “Hey, I’m going to put food on the table, or I’m going to do whatever it is, or I’m going to solve this problem in the business, or I’m going to make pizzas or whatever it is, but I’m going to be awesome at it, I’m going to do a great job, I’m going to learn something from it and then it’s going to give me that whatever nugget it is that as good or bad, culture or process or business or management or whatever. And I can take that little seed and move on to the next one.”

Carol:
Nathan, I absolutely love that. Such a good answer.

Nathan:
It was fun.

Carol:
Okay. Here’s number two. What is the best piece of advice that you have for small business owners or young entrepreneurs that you haven’t mentioned yet here today?

Nathan:
I’m not sure if I stated it really, really plainly and clearly. So I’ll just state it again which is focus. And if you are going to bed at night and you’re thinking about it in the morning when you wake up, then you know you are on the right track for the thing that you are wanting to obsess about. And then have a filter of somebody who is a data-driven person who can look at that and think about it and allow them to put holes in your ideas and to question you on it and challenge you on it and rip it apart and put it back together and the better you are at listening and the better you are at shutting up and letting other people share input once you … Create the vision, create the ideas, but then allow space to listen and other people to take ownership of your ideas. The more successful, the more happy and the better the things going to go.

J:
Love that. Absolutely love that. Okay, question number three. This is where I asked you your favorite business or technical book. Let’s see. You have now mentioned in this episode, Traction, Rocket Fuel, Extreme Ownership, you mentioned Delivering Happiness, and The Five Dysfunctions of a Team. So we already have five books. I’m going to make you pick a different one. So besides those five … Oh and the E Myth, I missed the E Myth, so six books. If you had to pick a different book to recommend to our audience, what would that book be?

Nathan:
No question and books are so important. By the way, obviously, I’m obsessed about books. Maybe not obviously, but talking about this many and we also read them as a team every Wednesday. We have a culture meeting, it’s not called culture, but our whole team gets together every Wednesday and pre-COVID, we are doing that in person, we call it a leadership lunch and literally reading books together. So Go-Giver was one that we did, but Never Split the Difference is the book I’m going to go with because I got to meet the author virtually, former FBI negotiator and the book is just full of nuggets and things that make you a verbal, tactical ninja, and not in a way that you could or should take advantage of people, but it gives you tools in a superpower in a way that you would not use. And when you’re trying to say the same thing and you can restructure via labels and labeling and mirrors and structuring your questions, so man, that’s a monster book and if you really like that, then read Tony Robbins Unlimited Power and it’s like a next level of that so.

J:
Love it. Okay, you gave me three to add to the list. So Never Split the Difference is the big one, that’s by Chris Voss and I will also add Tony Robbins to the list as well.

Carol:
Super. Okay, the fourth and my most fun question is what is something Nathan that either in your work life or one of your I want to say, I’ve got to just turn our listeners in on to the fact that you’re this amazing musician, and you are this massively huge award-winning MMA fighter and so many other things. You are so multifaceted I can’t even stand it. So in one of your aspects of your amazing life, whether it’s one of those or with your family or at work or whatever, however, wherever. What is something along the way that you have splurged on? Whether it’s a material thing or an experience or whatever that was totally and entirely worth it?

Nathan:
Oh man. By the way, I have fought in an MMA fight, but I wouldn’t necessarily I’m awarded there, but I am on an amazing team there for sure. Glory MMA, I’ll give them a little shout out and Lee’s Summit, Missouri. They got a bunch of people in the UFC by the way, starting to get off track. Okay, so splurge, I have a lot of different things that I enjoy and I obsess and so I enjoy obsessing about different things. So I’ll give you two, if that’s okay, so one for me and one for we. So for me was I had become a watch guy and I’m definitely obsessed about watches, I love movements and how they work and how the components come together.
And did you know on the face of a watch when you look at automatic movement that all the things that are happening on that watch, it’s the complexity of the movement that makes it work. And so I’m staring at my Rolex Root Beer which is a cool watch and hard to get ahold of and it’s ridiculously expensive and stupid, but I really enjoy it. And so that’s something that has been fun for me. And second would be we just picked up a little center console fishing boat because my son has become super obsessed about fishing and so he and I literally, this summer, we probably got hundreds literally of fish and spent hours and hours and hours fishing. And he’s become quite the fishermen too, by the way and he’s nine. And so we bought this little center console fishing boat, and it’s been just a blast. And we’ve been learning and obsessing about fishing and having fun as a family doing it.

Carol:
Those are both such awesome splurges. Thank you for sharing.

J:
I love that. Okay, that was the four part of the Four More. Now for the more part of the Four More. Can you tell our listeners where they can find out more about you, about your company and anything else that you would like to share with us?

Nathan:
Yeah, absolutely. So thank you again for having me on J and Carol, this is such a pleasure and so humbled by the opportunity and seriously, love you guys, and I think for people who are watching, they are just as cool as you think they are, if not more, so good people, and great people and legitimate. So our company is bridgeturnkey.com and you can check out what we do there. Both our renovation properties, our new construction properties, and I’m so freaking pumped about Tulsa. It’s just so cool to have a secondary market and something our clients have been asking about for a while so we can deliver on that. That’s great for us, great for a company, great for our clients. So it’s a win, win, win.
We’re on Facebook or I’m on Facebook, you can just search me Nathan Brooks, I do get rather large amount of friend invites so please shoot me a message if it’s something specific. And connecting there is great and then I’m on Instagram too, I don’t even know what my handle is, Nathan Brooks REI or something like that, I’ll have to check that down. But once you watch the social dilemma, you wonder about that. But in any case, and last, but not least, we have a meetup here in Kansas City Bridge Real Estate Investing Meetup, we got a great page there, especially people everywhere in the US are on there, but also Midwest and locally there so.

J:
Awesome. Have any good guests upcoming at your meetup?

Nathan:
Well, it just so happens the timing, we did not plan it this way, but the one and only Mr. J Scott will be a week from today. And I will say, dude, we have the coolest space and the coolest thing and this COVID thing is really putting a damper on the whole in-person. But regardless, I know you’re going to bring some fire and thunder and now we get to reverse roles here which will be a blast.

J:
Yeah, so anybody out there that wants to hang out with Nathan and myself next week, actually it’s this week when you’re listening to this. Go to the Bridge Turnkey page or the I’m sorry, what’s the …

Nathan:
Bridge Real Estate Investing Meetup and please, just answer the couple questions. It’s amazing. We probably would have added thousands of more people, but we don’t just let anybody in. We want you to be interested, back to culture, back to whatever, take that five seconds, fill out the questions and come get after with us there. So it’ll be great.

J:
Cool. Join the group on Facebook and then sign up for the Bridge Turnkey Meetup. Nathan, thank you so much. This has been absolutely amazing. Carol and I think, I speak for both of us, we’re so happy to be able to call you a friend and colleague and we appreciate your coming and sharing all your amazing knowledge and experience with us and our listeners today.

Nathan:
Thank you and I couldn’t agree more and likewise. So thank you guys and …

Carol:
Thank you Nathan. We think the world of you and we’re so grateful to have you on the show and can’t wait till the next time. Thank you.

Nathan:
Likewise. Likewise. Thank you.

Carol:
Bye. Seriously, I absolutely loved everything Nathan had to say, right? I think he did such a great job really approaching the conversation from the business side of his real estate business, right? And I especially loved how he not only gave us really a blueprint of actionable steps about hiring the right people and integrating them into your business, but he also really stressed how absolutely critical it is for the ongoing strength and growth of your business to get those people in in the first place.

J:
And here’s the thing I love. We talked about metrics. Well, here’s a metric for you. I think this episode probably had more tips per minute than any episode we did. Just literally jam packed with amazing tips.

Carol:
Agreed.

J:
So okay. Well, this has been a long one. So we are going to give everybody the rest of their day back. Thank you for tuning in and have an amazing, happy, healthy, and fantastic rest of your week everybody. Thank you for listening, and we’ll talk to you next week. She’s Carol, I’m J.

Carol:
Now feel the vibe with people in your tribe today.

J:
Nice. I like it.

Carol:
Better and better every week. Thank you everybody. Have a super week.

J:
Thanks everybody.

Carol:
Thanks for listening.

J:
See you.