BiggerPockets Podcast 137 with Sam Craven Transcript

Link to show: BP Podcast 137: How to Use Systems to Scale Your Real Estate Business with Sam Craven

Josh: This is the BiggerPockets Podcast show 137.

Sam: We wanted to build an empire with the core competency of helping customers and identifying opportunity in the market so that’s really what we’ve strived for from the beginning.

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Josh: What’s going on everybody? This is Josh Dorkin host of the BiggerPockets podcast here with my host Mister Brandon Turner. What’s up, Brandon?

Brandon: Hey, not a whole lot. What’s up with you?

Josh: Oh, man. It’s been a fun week.

Brandon: I hear. You’ve got some drama.

Josh: You know, dealing with insurance is never fun. Let’s just put it that way. I’ve got some headaches. I bought a new house with a few problems, let’s just put it that way, you know, things that probably should have been disclosed that weren’t, you know, some kinds of leaks and things like that that are damaging new wood floors. It’s stuff that makes you want to smile about humanity and really feel good about how people treat other people so, yeah, love that.

Brandon: Let me ask you a piece of advice because you just bought a house and I’m in the process of buying a new house for my wife and I.

Josh: Sure.

Brandon: Here’s my question: I’m buying it from a guy that I know and I know very, very well.

Josh: Yes.

Brandon: Like I’ve gone to church with him for years, I’ve hung out with him. He actually built all the trim in my current house because he’s a trim-carpenter guy. Anyway. Very good friend of mine. I’m buying his house. The inspection report came back yesterday and overall it’s a newer house, it’s a beautiful, awesome, huge house and I love it, but there’s some things that are wrong with it. Like, a lot of the window trim, outside window trim, has got rot in it and stuff like that.

Josh: This is the guy who’s done trim on your other properties?

Brandon: Well, he did the inside trim. He cuts molding so he has a big machine. So the outside of his current house which he actually didn’t—it was a built house that they bought. Do I bug him? They’re already not making money on the house. I’m buying it for what they owe on it. Do I make a big deal out of that? I mean, there’s several thousand dollars’ worth of damage that I need to get fixed. Do I make a big deal or do I let it go?

Josh: You know, business is business and friendship is friendship. You’re paying probably retail for the property you should ask him to get it fixed. You should definitely negotiate to get it done.

Brandon: Okay, I probably will.

Josh: Now, you may not be able to talk to him at church afterwards. Keep that in mind.

Brandon: That’s the fear. I don’t want to be like I’ll be mad if you don’t do it or I’ll back out, but I kind of do—we’ll see.

Josh: It’s not an insignificant amount of money.

Brandon: Yeah, I mean, it’s some damage that I will have to fix myself if not.

Josh: Right. So this is a business transaction so you need to treat it as a business transaction. That’s why you don’t do business with friends. That’s why you don’t buy houses from friends. I mean, seriously. If the friendship is important to you suck it up and eat up the thousands of dollars that you’re going to eat up. If you’re making a business transaction, then make the same business transaction that you would make if you were not friends with this guy.

Brandon: Yeah, you know what a good solution might be is to trade him he supplies the wood and I’ll put it on, you know, cause he does that for a living anyway. So, who knows? Anyway. I’ll throw that out there. If other people have suggestions they can put them in the show notes, leave a comment in the show notes at BiggerPockets.com/show137 let me know what you’d do and with that let’s get to the show. Actually, let’s get to today’s Quick Tip.

Josh: Quick Tip.

Brandon: Today’s Quick Tip is, cause we mentioned it in the show and we already recorded this an hour ago, so we mentioned during the show with our guest the idea of the webinar replays. We actually do webinars every week on BiggerPockets and teach stuff about real estate and we put all the replays up for Pro members to watch. So, if you are a Pro member make sure you check those out BiggerPockets.com/ProReplay and if you’re not a Pro still go there and check it out and see what’s there cause there’s 30 hours now of video so check it out.

Josh: If you’re not a Pro go to BiggerPockets.com/Pro to learn more about the benefits of going Pro.

Brandon: There you go.

Josh: Alright, cool. So, let’s really quickly bring in today’s sponsor which is—

Brandon: Alright. This episode is brought you by RealtyShares.com. RealtyShares is a real estate crowd funding platform that allows accredited investors to invest in pre-vetted real estate deals online so investors can browse and invest in both residential and commercial properties that yield returns of 8% to 16 % annually. As a RealtyShares member you can also passively invest in professionally managed real estate investments in a variety of asset types and geographies for as little as $5,000 all from the convenience of your living room. So, to learn more and to get started with a free account visit RealtyShares.com/BiggerPockets. That’s RealtyShares.com/BiggerPockets.

Josh: Awesome. Good, good, good stuff. Alright. So, today’s show. Sam Craven, we had this guy in before didn’t we? Show 33 of the BiggerPockets podcast. Sam’s been busy. Sam’s been real busy and in that first show, I mean, that was one of our more popular shows wasn’t it?

Brandon: It was. Number 33. It was great.

Josh: Yeah. So he was just talking about how he had just pretty much gone from nothing and built up this business pretty quickly, well, he has continued to do so. We talked with him about how he has raised all this money in private bank financing. How he has scaled his business, really dig deep into the scaling of the business which I think is really interesting. They’ve done $15,000,000 in business in the past 2 and a half years. We talk about some struggles and all sorts of other stuff so definitely tune in. It’s fascinating and it’s really cool to see an investor who’s kind of come out of nowhere really in the past few years and built this really great, scalable business that people can probably emulate. Obviously I’m not saying go and compete against him, but you know, there’s a lot to learn.

Brandon: It shows you what can be done.

Josh: Yeah, there’s a lot to learn.

Brandon: Like he started with a full-time job working just like everybody else and he bought a bunch of houses and kept improving and improving and today he’s doing this full-time with five people on his staff and it’s awesome.

Josh: It’s great. Let’s bring him on. Let’s do this. Alright he’s back ladies and gentlemen, it’s Sam Craven. What’s going on, Sam?

Sam: Hey guys! Not much just coming to you live today from Ridgeway, Colorado library.

Josh: Nice.

Brandon: Nice. Why are you in Ridgeway? You aren’t from Ridgeway. You don’t even invest in Ridgeway, right?

Sam: No, I don’t invest in Ridgeway yet.

Brandon: Is that why you’re there?

Sam: No, we’re here—my wife and I started a cross country road trip last week on Friday.

Brandon: Did you?

Sam: Yeah.

Brandon: Are you copying me?

Sam: Straight up copying you, Brandon. I saw what you were doing and I said, “you know what? That’s one smart dude. I’m going to go do exactly what he’s doing”.

Josh: Nice. So where is Ridgeway? I’ve never heard of this place.

Sam: You know where Mantras is?

Josh: No.

Sam: You know where Grand Junction is?

Josh: Yup.

Sam: Okay, it’s a little south of Grand Junction.

Josh: Okay, got it. Got it.

Sam: A little hour south of Grand Junction.

Josh: Little over an hour. Right on, right on.

Sam: Yeah, right where we like to be frankly.

Josh: Ah, that’s awesome. Yeah, it is a pretty part of the country.

Sam: It is.

Brandon: Yeah, it is.

Josh: Right on the Utah border.

Brandon: Before we get into this I do what to know what are your plans for your road trip? Where are you guys headed? You said cross country, you started where? Where are you from?

Sam: Yeah, we’re in Houston.

Brandon: Okay.

Sam: So we actually loaded up our Land Cruiser, piled in all of our stuff. We came out here, we actually fell in love with this part of the—

Josh: “We decided not to take the Ferrari,” right?

Brandon: What?

Sam: Exactly. You know, you can’t camp out of a Ferrari.

Josh: Okay, okay.

Sam: Yeah, we really love this part of the world so we rented a house here for a week and then the following two weeks we’re going to be camping, actually, Colorado, Utah, what else? North and South Dakota, maybe Wyoming that kind of stuff.

Josh: Nice.

Brandon: If you come to Washington you can camp in my backyard.

Josh: Are you car camping like Brandon does? Like he lays in the back of his Prius and camps, is that how you guys do it?

Sam: A little bit like that. So we have like the complete opposite of the Prius so our Prius gets 11 miles per gallon and takes premium fuel.

Brandon: Is that a motor home did you get or is it just a big vehicle?

Sam: No, it’s our Toyota Land Cruiser that we have a rooftop tent on and a refrigerator and drawers so we just live out of our car.

Josh: Oh, wow.

Brandon: That’s great.

Sam: Yeah, technical term is Over-Landing. We do it every year.

Josh: Nice. Yeah, you need to take some pictures and share them with us cause that sounds awesome.

Brandon: Yeah, we’ll put them up on the show notes page.

Sam: Yeah, yeah. I’ll do that. Yeah.

Brandon: Okay, cool. Okay, so you—

Josh: Are we here to talk about any real estate?

Brandon: No, watch this transition you guys. Watch this. You ready? So I want to talk about how you’re able to invest in real estate while still being able to travel the country. I mean, that’s kind of a cool topic because most people can’t do that. They can’t just go and pack up and leave for weeks or—how long you gone for?

Sam: Three weeks.

Brandon: They can’t just leave for three weeks. We’ve got to get into that.

Josh: Before we even get into that—

Brandon: I know, we’ll get there.

Josh: Because Sam’s been on the show before. You were on show, what was it? 30, what was it? This is show 137 so—

Brandon: He was 33 I think.

Josh: You were on show 33. Alright. So, you guys who weren’t listening check it out at BiggerPockets.com/show33 and it was actually a pretty amazing show. Back then I seem to recall you were working a full time job or something? You were doing real estate on the side. I believe things have changed a lot since then, is that right?

Sam: They have changed quite a bit since then you’re exactly right.

Josh: Okay, bring us up to speed.

Sam: Okay, so I think that show was maybe almost 2 years ago now and we were maybe 9 months in to our first full calendar year of doing business and I think we had done 25, 27 deals or so. Since then, honestly I don’t know the exact count, so maybe 115 houses or so we’ve done since we started our business and this year we’ll do—we’re on track to do 90 houses this year.

Josh: Nice.

Brandon: Wow. What do you mean by “do”? What are you doing with them?

Josh: Yeah.

Sam: So that’s a really good question.

Brandon: Thank you.

Sam: So our business model is basically to build leads, create leads, and monetize every lead that comes in. A majority of the time—

Josh: Go ahead. I was going to ask what on earth that means.

Sam: Okay, well, excellent question Josh. So what that means to us is generate leads of motivated sellers and then take them to monetize it the best way that we can whether that’s we’re going to hold it and rent it out, whether we’re going to hold it, renovate and sell it, we’re going to wholesale it, whether we’re do a net listing. I mean, it’s really, subject two is another one that we do. I mean, we really take the lead and customer tailor a solution for that particular seller. We are a customer service business. People are calling us because they have a problem that they need to solve and we do whatever we can. All of our staff is trained to do everything that they know how to solve their problem the best way possible in a way that’s profitable for us and makes the customer happy in the end.

Brandon: That is awesome.

Josh: That is awesome.

Brandon: Here’s what I love about that. So, I mean, when people are starting out don’t necessarily listen to what I’m about to say because when you’re first starting out you have to focus obviously and you don’t know everything, but I love the fact that when you talk to motivated sellers not everybody can be fit inside this one box, like, you can’t just wholesale everything. It doesn’t always work. You can’t just, you know, some people want to do a lease option, they can’t just lease option everything or just flip everything or just rent everything. So the fact that you’re able to then monetize a majority of your leads, or a good number of them, you know, it just opens up the possibility of just making so much more money and doing so many more deals.

Sam: Well, and you’re exactly right. We spend a lot of money on marketing to generate the kind of leads that we do and if we’re not able to efficiently turn them into profit for us to me that’s not a good business. If we’re just doing one thing or we’re only making one offer we’re missing tons of opportunity. Part of growing this business is realizing places like that where you can grow and you can find opportunity and you can gain market share.

Josh: Nice. Well, so let’s get into this. Previously on the last show your focus was what? It was wholesaling, right?

Sam: No, actually we were kind of a similar model but we really only had two methods then. It was just wholesaling and rehabbing.

Josh: Okay, so you’ve added a few other strategies to the mix.

Sam: Right. Wholesaling and rehabbing is still the majority of our business, but we are expanding further. I think last time I was on the show it was me and my dad that ran the business together and that’s it. Since then we’ve hired 3 more people, only 2 of which came 2 months ago, so we’re really making that effort to grow the company but at the same time grow efficiently. We have competitors that are twice our size by the number of employees and we focus on building the systems and the processes and putting that stuff in place beforehand and then we hire someone and they can immediately slot into exactly what their job is, and, frankly, once we hire them they help us improve that process even further.

Josh: Nice. So that sounds like a whole bunch of business mumbo jumbo for the novice, right? So how do you go from somebody who’s working with your dad who’s flipping and rehabbing to scale up your company to have a total of 5 of you guys who have all these other various strategies? I mean, you can’t just jump in and do that right away, right? Experience allows you to actually do that, am I correct?

Sam: You are absolutely right. So experience, aka screwing it up, will allow you to seek out those opportunities and seek out those processes, but to get down to the core of your question how do you, I guess kind of what you’re saying, how do you plan for that? How do you kind of shoot for something like that? And I always go back to goals. We’re really big on goals. We always have a 5-year goal, a 1-year goal, anyone who joins our company they have to fill out a goal sheet as well. I want to know what their 3 year goals are and how best we can help them achieve those goals within the context of our company. So, I think everything is going to go back to goals.

You know, when we started this company we didn’t want to be just doing 10, 20, 30 deals a year. We wanted to build an empire with the core competency of helping customers and identifying opportunity in the market so that’s really what we’ve strived for from the beginning.

Brandon: I love that.

Josh: That’s great.

Brandon: Yeah, I love that. So can we step in and talk—first of all, I’ll say this, the goal thing I think I’ve never heard anybody say that about bringing on employees and asking them what their 5-year goal is. I think that’s fantastic. I love that so, Josh, you and I are going to talk about our goals, my goals, later.

Josh: Yeah, clearly I don’t do that. Thanks, Sam.

Brandon: You know all my goals.

Josh: So that is the end of the show. It was nice having you on board, man! We really appreciate it and good for you and your goals, buddy.

Brandon: Alright, so yeah. I think it’s fantastic. I’m going to actually start doing that as well, but let me talk about the people you have working with you. You already mentioned your dad. On the last episode we talked to you, number 33, we talked a little bit about working with family and how that all works so we won’t talk a lot about that now, but the other 3 people exactly what do they do in your company? Like, what do they do?

Sam: Okay. Good question. So, Matt who’s actually—we went to High School together. We weren’t really great friends back then, but we actually connected through BiggerPockets.

Josh: Yeah.

Sam: Seriously. He reached out to me and he was like, “hey, you may not remember me, but we went to High School together. I see you’re doing some real estate stuff,” so we wound up wholesaling some deals together. I guess that was 2012 or so, 2013, and we realized we worked pretty well together. There was a good mix between the 3 of us that were in the business so Matt joined us full-time February of last year. His job is being the acquisition manager. Well, previously, I’ll say this so back up, up until a couple months ago he was just buying. He was the acquisition manager, he bought the houses, managed all the metrics, things like that. Now we’ve brought in a new buyer who’s a rock star and now his primary job is to go buy. Since Matt is buying less houses he’s taking more of a managerial role and that I think is going to allow us to grow because instead of just being out there buying houses all the time he can focus on the processes and improving those to help us grow even more.

I just mentioned Dan, he’s our buyer. He’s been with us for a couple months. I don’t know, I think this is his first full month out buying. I think he’s probably bought 4 or 5 houses for us this month, I mean, he’s doing very well.

Then we’ve got Clarissa and her job, she’s kind of the office manager. She keeps all of us in check cause lots of times we’re running around all of us with our hair on fire and she’s kind of the glue that keeps all that stuff together cause it’s like herding cats. I mean, when we were interviewing people for this we were telling them, “look, we’re not going to be an easy company to work with. Some days you might be working late, but it’s going to be fun every single day. We’re going to try to take care of all of our employees and make sure we’re all getting everything out of this that we really want to,” but yeah. That’s our team right now.

Josh: Nice. So, I get the office manager, I get the person who’s managing kind of the whole flow, the buyer, how does that work? I mean, do you guys just kind of set up your criteria and say, “get out there and buy as much as you can within these parameters,” and that’s it?

Sam: No, that’s not how it goes. So it’s kind of a—

Josh: Well, I guess I was completely wrong and yeah.

Sam: Thanks for playing, Josh. I appreciate it.

Josh: Thanks, Sam. You’re a great guy.

Sam: Hey, no problem. Glad to be here. Anyway. So we as the company one of my roles in the company is to do the marketing. So the marketing generates the leads, the call goes to either Matt or Dan and then they’re trained on how to basically get as much information as we can out of the seller in hopes that we can solve their problem. So, like I said before, everything goes back to customer service. How are we going to solve this person’s problem? And I hope we can do it by buying their house, right? So everything goes back to that customer service mentality.

So, the lead comes in, we take the lead and then we basically ask them a few questions, talk to them on the phone, have a conversation with them, figure out their pain points and from there it really becomes just following the lead, I guess. Once we get the lead it comes in, it goes into our CRM system, it gets assigned to a different task, gets assigned to different people depending on where we are in the process, and then the appointment’s set and we go out there and talk to them and see if we can buy their house and put it under contract if we can and then really it’s all downhill from there.

Brandon: Yeah.

Josh: You mean uphill.

Brandon: No, downhill. It’s easier.

Sam: Typically, downhill. Not always. We’ve all got horror stories, right? After we go under contract with something.

Brandon: Yeah, I actually might side with Josh on that one.

Josh: Thank you.

Brandon: It does feel a little—

Josh: You know, until close—

Brandon: The contract’s alright.

Josh: Yeah, yeah.

Brandon: Yeah.

Sam: Well, actually, to go back to that point a little bit if we’re asking the right questions and we’re feeling the seller out appropriately we try to get as much of those speedbumps out of the way ahead of time.

Josh: Sure.

Sam: So that we are nice and smooth through the closing process and everything else. I mean, we have issues on houses sometimes I’m not going to make it seem like we’re perfect, but that’s the name of the game. I mean, we are problem solvers. We’re going after properties that sometimes have difficult titles issues. That’s the name of our game. We’ve got to figure out how to do that, how to do that effectively and keep customers and buyers and everyone happy.

Josh: Right on. So what are you doing different? Surely there’s other folks in your market, or in the markets that you’re looking at, who have their own strategies. What makes you guys stand out? Why do you get to close on those deals when potentially other investors are coming in prospecting the same leads and not closing? What do you guys do that makes you special?

Sam: That’s a really good question.

Josh: Thank you. I came up with it all by myself.

Sam: Did you really?

Josh: No, actually Brandon was writing it down and I decided I’d steal that one.

Sam: See, I can believe that.

Brandon: I feed Josh everything.

Josh: Just answer the question!

Sam: So, to answer your question what makes us so different; I think it really is the customer focused mentality, and how process focused we are. You know, everyone else is out there to make that deal. When we pick up that phone and talk to our sellers everyone’s trained to not make the deal, but figure out why the seller has called us versus calling a realtor, versus typical selling methods. So I think if I had to narrow it down I would say it’s how professional we are, how we present ourselves to sellers, the way we present ourselves on the internet, the way we present ourselves to anyone who comes in contact with our business is far and above—we strive for greatness far and above who our competitors are. We have a lot of really good competitors in Houston and we have a lot of not as good competitors in Houston, but we always strive to be the best at what we need to be when we’re in front of the customer. Sometimes they need a shoulder to cry on. Sometimes they just need to get this thing gone next week. Whatever it is the seller needs we’re there to solve their problem and we want to make sure that they always know that when we’re sitting down in front of them.

Josh: That’s great. So, being there making sure they understand, you know, while your business is there to make deals that’s not your core, right? But you talk about the process, right?

Sam: Right.

Josh: What does that mean to me? If I want to build a process based business like you’ve got, you know, you talk about the customer service component. Okay, I get that, I can go out and give somebody a shoulder to cry on although mine’s a little boney, you know, not going to be super comfortable, but what processes do I want to kind of put together to help systematize what I’m doing here? Can you dig in a little deeper on that or is that the secret sauce that you’re unwilling to, and I’m still going to ask about it anyway, but you know.

Sam: Well, you can ask all you want. I’m going to give you guys a little bit of a taste here, okay? So when we were thinking about bringing someone on board to be a buyer what we had to do was we had to create a process for pulling comps and I am sure both of you are aware of what it’s like to pull comps. I mean, it’s a little bit of an art form, right? It’s not like exactly, you know, you can’t just pull the comps, do your CMA, take your median price of the 10 houses you’ve picked and that’s going to be your ARV, right? I mean, it’s very dependent on the level of finishes, the part of town you are in, things like that. So what Matt did to get us prepared for that is he created about 2 hours’ worth of videos on how to pull comps and then to go with those videos we have, I don’t know, 10-15 pages of documents to lay out, supporting documents, on how to pull comps. So when people join our team, I mean, Clarissa, she jumped in and she’s pulling comps now and it probably took about 2 weeks’ worth of oversight, but the reality is is she was getting on it pretty quick and I think that has a lot to do with that process that we built around that.

We have written processes for everything in our business from rehabbing houses to taking seller leads to delivering documents to the title company to everything every which way in between. So that’s really, to talk about processes, that’s a little bit of a taste kind of what we’re talking about.

Josh: Yeah, that’s great. That makes a lot of sense and I think that’s exceptionally helpful.

Sam: Yeah, I mean that’s the working on your business not in your business type of thing.

Brandon: Yeah, I love that and the fact that you mentioned video. I think video is getting easier, and easier, and easier to create these days to show people how to do things even if it’s a screen share or if it’s just talking in front of your iPhone. I mean, videos are so cool cause they stay on the web forever. I mean, you put it in a private YouTube room or whatever if you need to and then just send people you need to know the link and then every time from that point forward it’s done.

I mean, for a non-real estate example, this morning, you know I do webinars every week here on BiggerPockets, right? Every webinar replay we try to post them for our Pro members to be able to watch so we edit the replay so it’s perfect and smooth for our Pro members. That takes time and I do it every week and it takes a good hour of my time every week. This morning I was like, “this is stupid. This is such an easy process,” so this morning I wrote up this detailed 3-page document and a video on exactly how to do it and I will never have to do it again. Now Dave, who edits the podcast, will do it.

Sam: Boom. Now you get to work on the important stuff, right?

Brandon: Exactly.

Sam: Not the editing stuff.

Brandon: Exactly. Now there’s a process in place and I do that in my real estate, at BiggerPockets and everything I do I’m like, “how can I make this a repeatable process?” and you said something before the show when I first called you to do a sound check I said, “so what have you been up to?” and you used a phrase I thought was perfect. You said, “we’re trying to create a franchise-able business,” I think was the word you used, right?

Sam: Right.

Brandon: Not necessarily that you want to franchise, but you wanted to create a franchise-able business. Can you talk about that a minute?

Sam: Sure. That kind of goes back to if you have a franchise-able model it’s something that someone can buy, follow the systems that you have laid out word for word and make a profit, right? So if we’re creating a business that is “franchise-able,” right? That we’re going into it with a mindset that this is easily replicate-able. We have so many options available to us. I mean, if we ever want to exit the company or possibly sell the company, which I’ve never actually heard of a house flipping business being sold, we have—

Brandon: Yeah, I suppose it could be.

Sam: It could be. It absolutely could be. That’s what we want to create. I haven’t seen that done so if we’re creating a franchise-able model we have multiple options available to us. We have something where to some extent I can do leave for three weeks and the business can still operate because we’re doing it in that franchise-able model. We could be building the franchise-able model and who knows? Maybe we’ll be in 30 cities and we’ll still be the owners of it and it’ll be incredible. At the same time it could be something that we could sell 5, 10, 15 years down the road because someone will be able to buy the business, buy it based on multiple cash flow and go in and continue doing what we were doing because of the franchise-able model that we’ve built. So it’s really one of those things where it can pay off short term and it will pay off long term.

Brandon: Yeah. What I love about franchise-able models, even anything, right? McDonald’s or anything of the fast food, whatever franchise it is, right? The idea is that it’s scale-able because the process has been written out for you.

Sam: Exactly.

Brandon: So when you can take that, I mean, even like the idea of if you’ve got this process for how it works in one part of Houston you could fairly easily go and translate that to another. Now, there’s obviously going to be some differences you’ve got to work through.

Sam: Absolutely.

Brandon: And you can take that over to, I don’t know what’s near to you, Galveston? Take it over to Austin, you know, wherever you need to. I don’t know. You know what I mean?

Josh: As Sam shakes his head at Brandon’s lack of geographic knowledge of the Texas area.

Brandon: I don’t know. I just—

Sam: Hey, Galveston’s close—

Josh: I’m the voice in your head.

Brandon: That’s what I thought! I drove through Galveston.

Sam: I just wouldn’t go down there.

Brandon: Okay.

Josh: Oh, okay.

Brandon: Yeah, I drove through Galveston and then I drove through Houston and I forgot you lived there otherwise I would’ve probably looked you up.

Sam: Galveston’s a nice area, I just wouldn’t go down there.

Josh: Notice that he drove through your home town and never stopped to say hi Sam. Just saying.

Brandon: I forgot you were there.

Josh: If I were there I would’ve visited.

Sam: You forgot about me?!

Josh: Wow.

Brandon: It’s been 2 years, man, it’s been 2 years! I haven’t gotten your Christmas card in at least, like, 29 years, I don’t know.

Josh: Let’s bring it back. Systems, systems. Alright, so you’re building this repeatable, scale-able business that can work in Galveston, that can work in Austin, that can work pretty much everywhere. That’s great. So what does that mean kind of looking forward? There’s 5 of you, right? Is your dad still part of the team?

Sam: Oh, yeah. He’s an integral part of the team still.

Josh: Okay. So there’s 5 of you guys. How can we take this team of 5 and kind of translate it for somebody who’s new? What can they do to start their business and do it in a more efficient manner kind of keeping in mind what you’re talking about which is the scalability and the systems and things like that? And I stole that from Brandon completely.

Sam: I figured.

Brandon: Yeah, you know.

Josh: Apparently I don’t have a brain.

Brandon: I didn’t say it.

Sam: I think the best piece of advice I would have is to start with the end in mind. Figure out exactly what you want to build. Do you want to build a company that does 100 houses a year? A lot of people are going to want to pull their hair out. They want nothing to do with that and they can build just as profitable a business doing 20 houses a year. So I think really if you start with the end in mind it kind of goes back to setting your goals. What’s your 5 year goals? In 5 years do you want to just have 10 rental properties and do 2 flips a year? You can make a good living doing that. If that’s your goal you may not necessarily have to focus as much on the systems and processes as we do with what our expansion plans are. So, I think, as much as I hate to skirt the question like this I think it’s going to go back to setting what your 5 year goals are or setting what your goals are and your milestones to hit and figuring out what are the systems and processes that you need to hit those goals? Do you want to have a business that does 50 houses a year with you not even in the same country? You’re going to have different systems and processes than our company will because while I’m taking a three week trip here I cannot do this without the team that we have in place in Houston. This is more of a sanity trip than, “hey, I want to get the heck out and leave my business,” trip, right? I love my business. When I’m done with this podcast here I’m going to be jumping on the computer and taking care of business like I need to. So, yeah, like I said I think it’s going to go back to setting your goals and what it is that you want to accomplish.

Josh: Fair enough, fair enough. Alright, so what’s next? And we’re going to rewind, for those people who are listening, and we’re going to talk a little bit more about the deals that you guys do, but I think we thought it was important to kind of dig in a little bit on the business itself.

Sam: Absolutely.

Josh: Who are the next hires? Who are you looking at potentially bringing on next? Who do you need to scale it even better?

Sam: Right. Well, I think we’re going to wind up probably hiring, you know, this could go a few different ways. If we continue buying at the rate that we are currently we might need a new buyer. At the same time if we’re buying at the rate that we’re buying we’re going to need a project manager. Right now Robert, my dad, his primary job is managing our projects in our business and he has a lot of business experience, he has a lot of know-how, that needs to be put to work and if he’s out managing contractors it makes it that much more difficult, right? So that’s where us putting the systems and processes in place on how to manage rehabs and do it the way that Robert does it is going to pay off ten-fold when we hire that project manager cause they’re going to be able to jump right into the business, hit the ground running and then Robert’s time is going to be freed up to work on other stuff.

Josh: Awesome.

Sam: So, yeah, I think maybe a buyer or a project manager.

Josh: Okay. Cool. That’s great. And do you want to scale? I mean, you guys did what? Like 100 deals in the past year or so. Do you want to do 150? Do you want to do 500? I mean, are you happy at that pace? What’s kind of your thought on that?

Sam: Well, I think to clarify, we’ve done 115 deals in the last 3 years.

Josh: 3 years, right, sorry.

Sam: Right. We’ve done 45 or 50 or so so far this year. We’ve going to finish the year at 90, we’re well on track to do 90 houses this year. So I think next year I’d like to see the same exponential growth that we’ve been experiencing. You know, this year our business has, frankly, tripled. Our revenue has tripled every single year that we’ve been in business. I’d like to continue that, but I know that that’s not going to always be possible. I think for our expansion being in the real estate business I want to make sure that we’re making decisions, we’re making expansion plans, and growth plans based on what we’re seeing in our market. You know, are we going to have to go to another market to be able to continue to expand the way we have? Is that something that’s going to be right for us? That’s going to be right for our employees? Is it going to be right for our investors? You know, I don’t know.

Brandon: Very, very cool. Well, before we get on I wanted to make one more point about the whole franchise-able, the systems, the processes, before we get onto the specifics and that is we talked about the benefits to having that system being able to sell it possible or be able to franchise bigger. Another idea, though, and something you’re experiencing right now is that ability to replace part of your business. This comes from The E-Myth, you know, Michael Gerber’s book The E-Myth, but if your business is a machine that has all these cogs that are working you can replace pieces of them including yourself. So at some point you could pull out yourself from that cog and put another person in place and the business wouldn’t necessarily go down in flames. So, the fact that you’re on a 3-week trip, like, even though you’re still working you’re not there in person, but you’re able to travel. That might be the greatest benefit, I think, to that whole model of having systems and things in place. You know, that’s kind of what enables me nowadays. I worked super hard the first 7 years to build up a system for my business so that I could step back and that’s why I spend so much time on BP now and that’s why I work here because I love this. I like the real estate and I like doing it and I still do it but I love BiggerPockets. So because I have that business I can do what I love to do and still have the real estate working and generating passive income for the rest of my life.

Sam: Are you just saying that because Josh is on the phone?

Brandon: Yeah, pause it for a minute, Josh, and then I’ll tell you the real truth, Sam.

Josh: Wow. There is no love for me today, man.

Brandon: No, I mean, I’m not saying I love Josh, but BiggerPockets, though, man. I mean, I learned real estate through BiggerPockets. I found it when I was like, what? 21 years old. 8 or 9 years ago now.

Josh: How old are you now?

Brandon: 30. So I’ve been on since you started pretty much. I mean, I think there was 10,000 people on the site when I joined or something.

Josh: Wow.

Brandon: Whatever. So that’s just a cool thing. So let’s move on and shift gears from the systems. Like how I said that? Shift gears from the systems? Pretty good, right?

Sam: Nice job.

Brandon: We’re going to shift gears and talk about the specifics of what you’re doing right now that’s making you so successful. So why don’t we start with deals? Where are you finding them? How are you getting them? You mentioned marketing, what does that mean?

Sam: Okay, so our marketing engine is coming in from all different directions. One of the things that we experienced when we were starting this business is volatility in our monthly deal flow and I think it’s something that anyone, especially if you’re just starting out, you’re going to experience that volatility. You’re going to be like, “okay, I’m ready. I’m spending my $500,000, $200 a month, whatever it is on marketing,” and you’re 2 months in and you’re like, “what the heck is going on? Why isn’t this working?” right? So that volatility we experienced for a long time and we realized it had a lot to do with the fact that we were only marketing through one channel.

So we decided a long time ago that we were going to slowly start to diversify our marketing and what that looked like is we would do absentee mailers with postcards, Yellow Letters, we would do probate mailers with different types of media. We would also spend, what’s it called? High equity mailers at the same time. So we slowly started to build up that, our direct mail, and we slowly started to diversify within our direct mail.

Next up was going to be diversifying in our website presence. So, SEO, ad-words that type of stuff. So we’re still doing absentee mailers, we’re still doing our website which is doing great for us currently. We’re actually buying houses on the MLS surprisingly enough. Also we started doing what we’re calling our community marketing program where we don’t do bandit signs anymore, but what we will do is we’ll approach home owners, business owners, things like that and ask them to put up a sign in their yard and this is typically a more professional sign with a vanity number. We’re trying to work bandit signs a little bit more legitimately I guess is the best way to put it and not something where we’re having to put out signs every week, manage a sign putter-outter, go out and buy signs every week and things like that. We’re trying to, going back to the franchise-able model, we’re trying to do bandit signs in a more franchise-able way.

Josh: I mean, you’re trying to do it in a credible and legal way is what you’re trying to say.

Sam: Right.

Josh: Yeah. Okay. I’m not outspoken—

Sam: Yeah, I know you’ve got a vendetta against bandit signs.

Josh: Okay. I don’t have a vendetta against anything I just think people should run a business legitimately and I think bandit signs that violates city code shouldn’t be used so I like what you’re saying and I want to hear more about it. So this community marketing program, how does that work? I love that, by the way. I really, really love that. So do you just go up to businesses and offer them money? Or how do you kind of make that happen?

Sam: Same with anything else. We offer to lease sign space from them and if they’re on a street that we like in an area we want to target we’ll say we’ll pay you X number of dollars per month to put up this sign at this location and they don’t have to pay for the sign, they don’t have to pay for anything else and it’s very straightforward. As far as whether or not it works honest to god I don’t know.

Josh: Fair enough.

Sam: Yeah, one of the joys of growing a business is trying stuff and seeing if it works. I mean, it might all go to hell. I have no idea, but we’re definitely going to try it. We actually have purchased one sign from it so far so, one sign blah, we’ve purchased one house from it so far.

Josh: So it works.

Sam: So it works.

Josh: There you go. Just got your answer. There you have it. You just learned live on the BiggerPockets podcast that you are, in fact, successful. Congratulations.

Brandon: Yeah, I like the idea a lot. I read a book recently called 80/20 Sales and Marketing, I’ve mentioned it a few times on the podcast, but in there he talks about that 80% of the cars in the world drive on 20% of the roads out there and then of those 20% 80% of those cars drive on 20% of those roads so it works out to, like, 50% or 60% of every car drives on like 4% of all roads. So what he translated that to in terms of marketing is that you can go put out 10,000 signs randomly or you could put out 1 sign on a strategic spot and get just as many people as all those other signs. That’s why the big companies, you don’t see Coca Cola putting out bandit signs, right? They understand that that there’s a scalable model there like you talk about and when you can hit people where it matters in a location where a lot of people will see it, yeah, I think it’s brilliant so good job.

Josh: Brilliant, yeah. Can I jump in really quick? Cause I know you’re going to go somewhere else and I want to take it back to one more thing that Sam had said.

Brandon: Do it.

Josh: By the way, this is the BiggerPockets podcast and we are on show 137. You can check out the show notes at BiggerPockets.com/show137. Connect with Sam and ask him questions, find resources and things that we’ve talked about in there, but alright. Sam, you talked about high equity mailers. I don’t think we’ve talked about that in 136 shows so I’d like you to talk about that. It pretty much is what it sounds like, but for those people who don’t know what does that mean?

Sam: So high equity means that the person has a lot of equity in the house. The debt to the house versus the value of the house is very low, but the reality is I don’t do that anymore. We don’t do high equity mailers anymore.

Josh: Oh, okay.

Sam: They just—they’re too much of a low hanging fruit to people in our area. There’s too much competition and we were no longer getting the ROI out of it that we demand of our marketing.

Josh: Oh, fair enough.

Brandon: So, let me just ask maybe for people who don’t have a lot of competition with that and they maybe want to do that, how do they even get that list? Where does that come from? How do they know?

Sam: Yeah, it’s really easy. You can either get it through your local appraisal district or through list providers, Yellow Letters list source, things like that and you basically just want to pull a list. Typically, if they’re over 60 or so you’ll find some better motivation so you want to put an age limitation on it, maybe an age of the house, maybe how long they’ve owned it, but definitely you want to make sure that they have a lot of equity in there. That’s where going to someone like a list source, or YellowLetters.com will allow you to choose the right list and try to find the best motivated people.

Brandon: Very cool.

Josh: Interesting. Awesome.

Brandon: Alright. So, okay, you get all this stuff goes out; the mailers go out, the signs go out, everything goes out and you start getting phone calls. You already said your two guys will get those phone calls. They take them and now they go and they probably set up an appointment with the person, correct?

Sam: Right.

Brandon: Alright. So they go set up the appointment, they talk to them, they kind of find out where they fit, you know, what they could possibly do, then what happens next? I mean, you sign the contract with them, let’s just say, for example, you guys decided you’re going to flip the house, you’re going to rehab the house, how do you finance that deal? I mean, how are you financing those kinds of deals? The ones that you’re actually buying. Not the wholesaling ones, but the ones you’re buying to flip or do whatever else with.

Sam: Okay. So we finance through private lenders and banks.

Brandon: What does that mean? What’s a private lender?

Sam: Okay, yeah. Private lender is an individual who has some money they want to put to work in real estate, but don’t necessarily want to get their hands dirty flipping the house so they’ll come to someone like us who’s built the systems and processes and everything to keep their money as safe as possible and can put as much of it to work as quickly as possible and we borrow the money as a set interest rate and a set loan to value and get them in relatively safe compared to the market. You know, we don’t go in over 70%-75% of the ARV, we put them on the insurance as a loss payee on the property and then of course walk them through the process every step of the way.

Our lenders that have been with us for a while are worth gold to us. Just as a for instance, a lender that’s been with us for a while, I was out of town a few weeks and we got a lead on a property that came back to us, we had to close it in 3 days so I had to raise $300,000 in 3 days. I was out of town, our lender was out of town, there was so much trust in the relationship and the millions of dollars that I’ve borrowed from these people that we were able to get the job done, get it done right, make sure everyone was safe and that’s when it really comes down to processes. I mean, we’re agreeing to buy a house, I’m out of town, you know, I haven’t seen the house in 2 weeks, but everyone has to fall back on the processes and the systems that they know and just follow it to a T.

Brandon: I love that.

Josh: Makes sense.

Sam: So, but going to your question, that was a little aside, but we borrow money from private lenders and we borrow money from banks. Currently we have, I think, 2 or 2 and a half million dollars in bank financing and we got very fortunate and go out first bank line of credit of half a million. We were only 18 months old and really that comes down to having a good balance sheet.

So a lot of people that get into this business they don’t like to show a profit. For all of the right reasons they don’t like to show a profit on their balance sheet. We recognized pretty early that we were going to have to pay a lot of money in taxes if we’re going to be able to go after the cheap bank financing. I mean, our bank financing is anywhere between 5% and 6%. That’s pretty tough to beat.

Brandon and Josh: Yeah.

Sam: So in order to do that that’s where building that sustainable business comes from. Having a good balance sheet, having good processes. Even with bankers, man, go to your good local regional banks. You can’t go to the big banks, Chase bank, Wells Fargo Bank, they’re not going to want to talk to you if you’re wanting to borrow a million bucks from them. You know, that’s nothing to them, but you go to your little bank and you start building that relationship. You show them the processes that you have, you show them your past projects, you show them the before and after pictures. Give them the whole dog and pony show and they’ll want to listen to you. They’ll want to bring you into the office. They’ll want to be able to lend money to you and as you build that relationship more and more they’re going to want to give you more and more money. So I’d encourage anyone who’s getting out and starting their business if they’ve got a few deals under their belt go out and start talking to a few banks and see what they can get.

Brandon: I love that.

Josh: That’s great.

Brandon: To add onto that point, you know, you mentioned about you’re going to have to pay taxes. I know a lot of investors, I mean, there are a lot of things we can write off and you can be very aggressive in your tax planning strategies.

Sam: Right.

Brandon: But that oftentimes will shoot people in the foot by being too aggressive. I mean, two years ago I decided I needed to get a refinance on my apartment complex and I’m going to have a problem if I’m really aggressive so I scaled back and I was not aggressive at all, like the IRS loves me because I’m paying all these taxes, but this year when I go to get my refinance I had really good numbers to show them that they liked so yeah, there’s definitely ways that you can be more conservative or more aggressive with your tax planning so that’s just a tip for people. I mean, even just starting out. You can translate that to someone who’s brand new. People ask all the time, like, I’ve got bad credit can I get started investing in real estate? You know, yes you can invest in real estate without good credit, but look down the road 2 years, 3 years from now. Eventually you’re going to want that cheap bank financing so start getting that in shape right now whether or not, you know, I mean it doesn’t mean you have to sit out on the sidelines, but at least start looking that way kind of looking towards the future.

Josh: And talk to a CPA. I mean, that’s going to be your best bet is what’s the approach? I’m not going to tell it to you, Brandon’s not going to tell it to you and Sam’s not going to tell you. We don’t know and what works for one of us is not necessarily going to be what works for you so having that core team member of a CPA is going to be huge.

Brandon: Yeah, love it. Well, cool. I think it’s time probably to shift gears once again.

Josh: Oh, look at that.

Brandon: And transition over to the world famous Fire Round.

Josh: Before we do that I want to rewind really, really, really quickly.

Brandon: I was giving Josh that look the whole time, like, do you have any other questions? I’m waiting for you to ask—

Josh: I do. Yeah, well—

Brandon: I’m waiting for you to jump in and you just left me hanging while I introduce the Fire Round.

Josh: Well, I thought you were going to jump with it so I thought, well, you know, I’m just going to take it from here, Brandon.

Brandon: Alright, take it from here.

Josh: Thanks for the help.

Brandon: Thanks, host.

Josh: Sam.

Sam: Yes. I’m still here.

Josh: In the last couple years since you’ve been on the show tell us, you know, the coolest deal that you’ve done. What’s been your absolute favorite deal that you’ve done?

Brandon: That’s a good question, Josh.

Josh: I know. We should probably ask everybody that question.

Brandon: Probably should.

Sam: You’re really putting me on the spot with this one. I’m going to have to think.

Josh: Suck it up, man, c’mon.

Sam: Thanks.

Josh: I know it’s hard when you have a Rolodex of millions and millions of deals, but you know, c’mon. Surely there’s one that—

Sam: So, you want to hear, like, our—

Josh: I don’t care.

Sam: Highest profit deal? Do you want to hear one like we solved someone’s problem?

Josh: Sure. Absolutely. All of the above.

Sam: Okay. Aw, man. See, I wish you guys had given me these questions ahead of time and I’d be able to prepare something.

Josh: I know you’re having a hard time, you’re on vacation, coming up with fabulous deals so what about awful? Like, what was the worst experience you’ve had in the last couple years as an investor?

Sam: Okay.

Josh: Surely you remember that.

Sam: And this is a good one. Yeah, this is a good one because it was all my fault and it was because I didn’t follow our process. So, we had a deal where we had the trifecta go wrong, okay? We bought this house and I walked the house, I negotiated the purchase of the house, everything was great. I recall it a particularly good day because I think I bought three houses and a car that day, but this particular house was in fairly good shape. People smoked in the house, it wasn’t that big of a deal, but we close on the house and then we find that we have a huge amount of foundation issues that I apparently glossed right over and missed because I wasn’t following the process so we fixed the foundation.

Then we get our roofer to go out there and just check the roof which is standard procedure for us because we want to make sure that if it passes the roofer’s inspection which we trust then it’ll pass the seller’s inspection. It failed. So, we had to do the foundation, we had to do the roof. So we did the foundation and we did the roof. Then when they leveled the house part of the fireplace started to fall away from the wall.

Brandon: Uh-oh.

Sam: So I was like, okay, not a big deal. Really, that’s $500, $700, whatever it was. So pulled the brick down and re-brick it back up. Well, we pull the brick down and the whole wall is just chewed up with termites.

Brandon: Oh, man.

Josh: Nice. I thought we were going to find a dead body in there.

Sam: No, no. So the whole wall is chewed up with termites so we have to treat the house for termites and replace all the bad wood. So at this point the deal’s not looking that great. I mean, it was probably a $35,000 profit deal for us which is slightly below our average. So, yeah, we do the termite treatment, we do the roof treatment and foundation. At the end of the day, though, because I followed the rest of the process and bought it at a low enough price instead of losing money on that deal we made $8,000. Okay, now if you look at making $8,000 over the course of 3 or 4 months, however long it took to do that deal, we lost money if you include our time, but at the end of the day our private lender was made whole. Our private lender was never in a bad spot. We didn’t lose money on the deal, but because I didn’t follow the process that we all agreed on and wrote for walking a property we wound up losing $20,000-$25,000 of potential income from it so there’s a horror story for ya.

Brandon: There’s a good story.

Sam: It was a nice family. I was really happy to help the family, but yeah.

Josh: There you go. Alright. Fair enough. Good stuff, man. Thanks for sharing and if the other thing comes to mind obviously feel free to come on back, but I think this is a good time to transition, Brandon, perhaps.

Brandon: I think it is a good time.

Josh: To the world famous.

Brandon: World famous Fire Round.

It’s time for the Fire Round

Brandon: Alright. Today’s Fire Round is brought to you by FreshBooks. So if you are a real estate hustler you probably end up billing people for stuff quite often like late rent, contracting work, etcetera. I know that I do which is why I am a huge fan of FreshBooks and I recommend all the time. FreshBooks is an incredibly easy to use invoicing software designed to help entrepreneurs get organized, save time invoicing, and get paid faster. You can also use it to keep track of your employee’s hours, track expenses, and generate awesome reports. So bill like a boss, try FreshBooks free for 30 days just go to FreshBooks.com/BiggerPockets and enter BiggerPockets in the how did you hear about us section when signing up.

Alright, the Fire Round. These questions from the BiggerPockets forums, which listeners can get to at BiggerPockets.com/forums so if you have a question that you want somebody to answer here on the BiggerPockets podcast make sure you leave your question there in the forums. So, Sam, number one: what type of property is best to fix and flip; multi-units or single-family?

Sam: I would say that goes back to your goals, honestly.

Brandon: Okay.

Sam: Cause I think it really depends on where you are in the market, where you are personally, I mean, you can make really good money flipping multi-family but you can also make really good money flipping single-family. Yeah, I would go back to it depends on what you want to do and what you want to accomplish, but at the same time go back to what numbers work. If you’re trying to evaluate doing one versus the other go back to the numbers and see what the numbers tell you. What do the comparables tell you? What’s the cap-rate telling you on the multi-family? How much work do they both need? So, yeah, you’re going to need some pretty in-depth analysis on that one.

Brandon: Okay.

Josh: Fair enough. Alright. What’s worse for a tenant applicant; having an eviction or a felony?

Sam: Jeez. I’m going to go with neither one is renting from me.

Josh: There you go.

Brandon: By the way, do you have rental property as well now?

Sam: We do, yeah. We’ve got rental properties.

Brandon: Okay.

Josh: Excellent. So you’re not renting out to convicts or folks who skip?

Sam: Nope.

Josh: Alright. Fair enough. Easy-breezy.

Brandon: Alright, next one. How do you find cash buyers? If I’m a wholesaler how do I get cash buyers in a small town? I know you’re not in a small town.

Sam: No, definitely not.

Brandon: Houston’s a medium-sized town. Village really.

Josh: Yeah, little bit.

Sam: 6, 7 million people, yeah.

Brandon: Something like that.

Sam: Yeah.

Brandon: But in a small town how do you find cash buyers?

Sam: So I think a good place to start would be your multiple listing service and see who has completed cash purchases in your area. I imagine if you go back over the course of a year you might see a few people repeated. So, yeah, get on your local MLS it’ll be a good place to start. Also, network at the local diner, church, anyone, yeah?

Josh: Cool. Nice. That’s great.

Brandon: Well, now, how does somebody get the MLS if they’re not an agent?

Sam: Talk to someone who is.

Brandon: There you go.

Sam: Beg, borrow, do whatever you need to.

Brandon: Steal.

Josh: No.

Sam: The access to the MLS is pretty critical in this business.

Josh: Yeah, for sure. Alright, is it smart to invest in a red-hot market? Last question.

Sam: Well, I would say yes, but you have to be smart because I would say we’re in a red-market in Houston right now. It’s becoming more and more difficult for us to buy houses because it’s easier for someone to sell it on the open market and at the same time everyone and their brother thinks they want to be a real estate investor and the area is flooded with marketing. So I would say yes, it’s okay to invest in a red-hot real estate market, but you’re going to want to make decisions based on the fact that you don’t want to be in the house very long. So if the market’s really hot or if it’s looking kind of frothy or at the same time, you know, you want to look at other market indicators like in Houston our housing demand is still high. We still have a lot of people moving in even though oil has taken a bit of a hiccup, I guess, if you can call it that.

Josh: Just a little one, yeah.

Sam: Yeah.

Josh: I’d say 50% from its high, yeah.

Sam: Right. You know, we’re still net adding jobs in all of Texas. We’re still net adding jobs in all of Houston. We’re seeing in Houston like it’s taken its toll on prices on houses worth less than $150,000 and worth more than $500,000. So if you’re in a red hot market look at those economic indicators and say, “okay, maybe I should stick between $150,000 and $500,000,” or less than $500,000 I should say. So, yeah.

Brandon: Cool. I like it.

Josh: Right on. Excellent.

Brandon: Alright, let’s transition over to the last part of the show which we call the—

Famous Four

Brandon: These are the questions we ask everyone and we have asked you these 2 years ago. Actually I looked here on the calendar for when this show is coming out, we’re recording this a little bit early, this show is going to be coming out on the 2-year anniversary of your last show coming out.

Josh: Ooh fancy.

Brandon: Yeah, we did not plan that at all, but it’s exactly 2 years later. Weird.

Josh: Nice.

Brandon: Also, 2 years ago, maybe things have changed so number one what is your favorite real estate related book?

Sam: Real estate related book? I can’t remember what I said last time. Probably Gary Keller’s book.

Brandon: Okay. The Millionaire Real Estate Investor?

Sam: The Millionaire Real Estate Investor, yeah, as far as real estate goes. Honestly, I don’t think I’ve read any real estate book since the last show.

Brandon: Okay.

Josh: There you go. Tune into the podcast what do you need books for, right?

Sam: That’s right. Tune into the podcast and get on, of course, the BiggerPockets forums.

Brandon: There you go, look at that.

Josh: Yeah. By the way don’t forget Jay Pap is on as co-author of said book.

Brandon: Yeah, that’s true.

Josh: He was also a guest on the podcast so we’ve got to plug Jay there.

Brandon: Yeah we do.

Josh: Alright so you haven’t read any real estate books.

Sam: Right.

Josh: Yeah, well, I’m not going to ask the next question. Should we just end the interview now? I mean—

Sam: No, ask the next question cause I read business books up and down.

Josh: Alright. Fine. If you make me, fine.

Sam: Are you going to ask the question or do you want me to just go for it?

Josh: Business book! What is your favorite business book? What are you reading these days?

Sam: I’m actually three quarters of the way through a book right now which I’ve fallen in love with. It’s called Good to Great by Jim Collins.

Josh: Yep. Classic.

Sam: It’s really, yeah. It’s been an eye-opening book. I’m getting a lot of good information from that. Yeah, I’m enjoying reading it and honest to god I typically do not enjoy reading. My wife will read a book a day. I’ll read, if I’m lucky, a book every quarter. So, yeah, that Jim Collins book Good to Great can’t say enough good stuff about it.

Josh: Perfect. Alright, hobbies. What are you doing for fun these days besides trekking around the country, globally, whatever you do, ya know? Getting in the range. Car-top camping.

Sam: Yeah, so Over-Landing whenever we can, camping and at the same time also I love cars. I have a huge addiction to cars. In a previous life I was a race car mechanic so yeah. I think to give you an idea of how bad it is my wife and I live in a 1,000 square foot bungalow in Houston and we have 6 cars.

Brandon: Whoa.

Josh: Oh, man. So I’m on Google and I just searched for Over-Landing. I’ve heard the term, but I never knew and I’m looking at these trucks with, like, tents on the roof.

Sam: That’s it!

Josh: This is outstanding! Holy smokes! I see one the guy’s got a solar array parked on the ground in front of his truck. Wow! Is that what you guys do?

Sam: That’s what we do.

Josh: That is outstanding.

Sam: Self-sustained vehicle travel.

Josh: Dude, you’ve got to ditch the Prius, man.

Brandon: Yeah, this might be better than a Prius. I don’t know.

Sam: My wife actually writes for a couple adventure magazines as well.

Brandon: Interesting.

Sam: I take pictures, she does the writing, yeah.

Brandon: Well, send us a picture, and again, we’ll put it up on the show notes page at BiggerPockets.com/show137.

Josh: For sure. Yeah, really cool stuff. Alright, Brandon.

Brandon: Alright. Let’s see, my final question: what do you believe sets apart successful real estate investors from those who give up, fail, or never get started?

Sam: Boy, that’s a really good question again. Perseverance, I feel like, is a big one because the business, no matter what business you’re in, it’s going to constantly kick you down. Something’s not going to go your way, the marketing’s not going to go your way, you’re going to lose a deal, you’re going to lose money, you’re going to hurt a relationship or something like that and I would say it’s the perseverance to stand back up and go do it all over again the next day. Every single day it can kick your butt in this business. It’s a fun business. It’s a really rewarding business, but it’s also a very hard business to do the kind of volume that we want to do and build the kind of business that we have. So I would say that every single day the business kicks you down, chews you up, spits you out, the perseverance to wake up the next day and jump right back into the fire.

Josh: Right on. That’s great, man. Alright, Sam, well listen, thanks so much for coming back on the show. Where can people find out more about you?

Sam: Sure. Okay, so our website is SennaHouseBuyers.com. That’s the best way to get ahold of me. If you want to follow around with our travel stuff on Instagram I’m @TheRealSamCraven and that is a joke by the way, I’m not that egotistical, and yeah. So if anyone wants to reach out to me the best way is to go to the website and fill out a form on our website and that goes direct to my email. Be happy to talk to anyone about anything.

Brandon: Nice. By the way I’m on your website right now SennaHomes and I’m looking at you and your dad. Your dad looks like a nice guy.

Sam: Yeah. He’s a nice guy.

Josh: Don’t judge him.

Brandon: I like his mustache.

Sam: Were you expecting, like, a devil or something?

Brandon: No, I’m just saying he looks like your typical really nice, like, TV dad. I don’t know. Nice looking guy.

Josh: “Can he be my dad?”

Brandon: He kinda actually looks like my dad! They have the same mustache. Anyway. Alright. So, yeah, let’s get out of here.

Josh: Sam, thanks for coming on, man. It’s been fun.

Sam: I really appreciate it. This is always good. Brandon next time you’re driving through Houston don’t forget about me, man.

Brandon: I won’t forget about you next time. I’ll be looking for your Christmas card this year too.

Josh: Touché.

Brandon: We’ll see you around.

Josh: Get out of here! Good bye. Take it easy.

Sam: Alright, see you guys.

Josh: It’s been fun. Enjoy your trip! Alright guys that was Sam Craven. Hopefully you guys enjoyed the show. Lots of fun. Lots of great information. Really, really good information. Cool show.

Brandon: It was a cool show, yeah.

Josh: Always a fun guy.

Brandon: I do like Sam a lot. I remember that from last time. He’s just a riot so it’s good to have him.

Josh: Yeah, it was great. So definitely check out the show notes, guys, if you want to sync up with Sam and you can do that at BiggerPockets.com/show137. That’s BiggerPockets.com/show137. You can find Sam at BiggerPockets at BiggerPockets.com/users/SamC and otherwise if you are listening to this on iTunes and you’re only seeing the last 20 shows on iTunes you can go to BiggerPockets.com/podcast and find all of our old shows as well. You can also listen on Stitcher or Lipsin or SoundCloud. There’s all sorts of different ways to check out the show so definitely do that and please subscribe to the show on iTunes, subscribe on the various other mediums and do leave us some feedback and star ratings. Those definitely help us get the word out about the show so we really appreciate it. Otherwise that’s it!

Lots going on on BiggerPockets. We’re trying to make lots of cool new features and additions to improve your lives and if you’ve got suggestions ever please don’t hesitate to reach out to us by email at BiggerPockets.com/Contact and let us know what you think. Let us know if there’s anything you’d like us to add on to make the site better for you. Otherwise that’s all I’ve got. Follow us on Facebook. Jump in on our forums BiggerPockets.com/forums and I don’t know. that’s it, man.

Brandon: Cool. That’s good. Let’s get out of here.

Josh: Let’s do it.

Brandon: Do you want me to sign off? I can do it.

Josh: Do it.

Brandon: Alright. Follow us on all of the social media channels and let’s get out of here. For BiggerPockets this is Brandon and Josh signing off.

Josh: Signing off!

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Brandon: Which we call the Famous Four. The sound effects go there.

Josh: I hope they do.

Brandon: Yeah, otherwise what if Dave didn’t put them in every week? That’d be really funny. He just purposefully left them in just to mock us and we never knew.

Josh: What do you mean you don’t listen all the way through Brandon?

Brandon: What are you talking about? What? Of course I do.