Let’s face it — you need to get out of your business!
I’m going to assume that you got into real estate investing for the sole purpose of creating your dream life.
Now that you’re neck deep in it, how’s that going?
I know that for myself, a lot of the time it feels like I traded a life for a business! When you’re an employee, at least you get to go home each day and have your weekends. As a business owner, sometimes it feels like work never shuts off!
But it shouldn’t be that way. If you’re strategic, you can successfully set your business on autopilot and truly begin living the life of your dreams. It just takes a little work — and a whole lot of faith!
The 20 Best Books for Aspiring Real Estate Investors!
Here at BiggerPockets, we believe that self-education is one of the most critical parts of long-term success, in business and in life, of course. This list, compiled by the real estate experts at BiggerPockets, contains 20 of the best books to help you jumpstart your real estate career.
The #1 Thing You Need to Automate Your Business
The key to automating your business is firing yourself. That’s right!
You need to be FIRED from your business!
What I mean is that every business has a certain formula or system to it. Whatever the business is, it can be broken down into functional parts. You as the business owner should never be in a role where you help produce the function of any of the parts of the system of your business (unless, of course, you want to play a certain role in your business).
Your job as the business owner is to be the creator of the system and the manager of it, making sure all the parts that make up the whole are running smoothly and well taken care of.
You cannot paint a picture while being the paintbrush, and likewise, you cannot be a successful business owner while being an employee in your business.
It just doesn’t work that way!
So, you need to fire yourself and outsource all tasks (again, except for the ones you want to do) of your business to other people.
How exactly? Let’s get into the details.
Breaking Down the Aspects of a Successful Wholesale Business
So, as a real estate wholesaler, I know that my business can be broken down into 4 components:
- Sales and marketing
- Transactions (closings)
- Other (random tasks like bookkeeping, emails, etc.)
It’s very simple. I need to get cheap properties and then find buyers for them, sell them, and then close on them and get paid.
Though it’s simple, each component of my business really carries enough workload for a full 40 hours a week at scale, and obviously, I’m only one guy, and I don’t even want to be working a full work week.
I want to be working closer to 10-20 hours a week, so obviously, I need to hire people to handle all 4 aspects of my business.
To determine how many people I need to hire for each portion of the business, I first need to figure out how much money I want to be making personally.
Let’s say, for our example, I want to make $100,000 a year, which, when broken down, would be $10,000 a month.
So, if we average a conservative amount of $3,500 per deal, that means we need to at least do 3 deals a month, just to cover my salary.
However, if we consider direct mail cost, what it would cost to cover people’s salaries, overhead expenses, etc., practically, it could easily cost $30,000-$40,000 a month to run this machine!
So, if we take $40,000 and divide it by $3,500 per deal (in my business we average about $7,000 per deal), that would mean that we need to buy and sell about 12 deals a month.
If you’re just starting out, this may sound like a lot, but I routinely average about 10-12 a month (namely because I run a team, just like I’m suggesting you to do in this post), so it is totally realistic.
The Final Step
So, now that you have figured out how much money you want to make and how much it will cost to operate a business on autopilot, your next and final step is to assign people to the correct roles — and then let go.
The first part is pretty easy. Placing the right people in the right spots on the team is just a matter of assessing personality strengths and matching them with the right needs.
For example, your acquisitions guys need to be super people-oriented, great thinkers on their feet, and motivated by money, numbers, and stats.
You’d never want an overthinking, “data” person in that role.
However, when it comes to handling all the paperwork for buying and selling a house, putting up signs, changing out locks, etc., having a people person who is all over the place would be suicide for your business.
For transactions, you really want someone who is detailed, methodical, and consistent. So, you simply match the personality of the person you’re interviewing with the role that’s needed.
But the second part of letting go — that’s the tough one.
If you’ve set your systems up correctly, you now have people in the right roles to cover all the needs of your business.
You don’t have to handle any of the day-to-day work, but it requires something: trust.
If you cannot let go of the wheel and trust the people in the roles of your business to do their job well, then you will not benefit from being a business owner.
You have to let go and allow the system to work. Otherwise, it’s all pointless.
This can be a lot harder than you’d think. I know for me, I did this business for 10 years by myself, and to let it go feels like I’m losing control of my baby. It’s scary!
But I got into this business to support and create a life, not have a life that exists to support the business.
So, let go. Let your team handle the messes and screw ups and go smell the flowers!
Stay out of your business and begin allowing the purpose behind your business to actually take place.
Where are you in the process of automating your real estate business?
Leave your questions and comments below!