You Need Business Building Skills, Son!
Do you dabble in real estate investing? Do you think of REI as something fun and challenging that you really enjoy?
Well, maybe it’s time to consider turning your real estate investing “hobby” into an actual business.
But how do you do it and what the heck does that look like anyway?
Have no fear, we’re gonna lay it all out for you in today’s post.
Are you a strategic investor?
In REI, we often talk of the three main pillars that define a strategic investor…
- A strategic investor understands the value and importance of having the right mindset and is constantly sharpening his/her mindset.
- A strategic investor understands the importance of real estate investing strategies and tactics.
- A strategic investor understands business-building skills.
I’ve noticed that for many investors, that third pillar is the tricky one. So let’s take a closer look…
Is the term business building confusing?
Some people say, “What do you mean business building; isn’t that what I’m doing day after day trying to find and close deals?”
And that’s exactly it…
Are you building a business or just a hobby? Do you know the difference?
Working in your business is not the same as working on your business. Running and operating a business is its own separate skill set – building your business is another. The more you develop your business-building skills, the less overwhelmed you’ll be and you’ll actually be more successful.
And, in order to do that, we’d like to offer some tips and thoughts to sharpen your business-building skills.
Business vs. hobby
Firstly, you’ve gotta recognize that a real business runs without you being totally involved in the day-to-day operations. Really, it can and should run without your involvement. A real business has teams, tools, and systems in place to help it operate. (Can you say that about your hobby? Probably not.)
When that’s all in place, you won’t be haphazardly doing everything that’s needed to buy, lease, and sell real estate.
I meet investors who are trying to do everything themselves. Of course, there are advantages to learning different parts of the business. And perhaps when you are first starting out, you’ll probably be doing all the tasks… but if you keep that mindset and remain in that place, then you’ll ultimately go crazy, burnout or both.
A book that may help you better understand the concepts we’re talking about is The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It. This book points out the difference between working inside of the business and workingon the business.
A good first step in the right direction is to analyze your time. Look at all the time you spend working in your business – those day-to-day tasks that eat up your time, such as:
- Marketing
- Property Management
- Doing Rehabs and Repairs
- Accounting and Bookkeeping
How many of those tasks could be completed just as well by, say, bringing in contract labor?
Once you’re freed up of the day-to-day stuff, you’ll have time to devote to work on your business and build your power team to take your business to the next level.
Work on your business by building a better team
I’ll say it clearly – you cannot wear every hat all the time. So, what do you do?
You might want to begin with hiring an assistant to whom you would hand off the detailed, repetitive tasks. Or perhaps if you’re a landlord, your first hire will be a property manager.
Hire competent people to do the everyday tasks – to take them off your plate so your focus is elsewhere.
Keep looking at what you do each day to figure out which tasks could best be handled by someone else.
In the early days, when money is tight, you may want to consider going with a company called FancyHands. For a low monthly membership fee, you can hire a team of assistants who can do clerical and office-type tasks for you remotely. It’s cheaper than a full-time assistant and it’s a good way to get comfortable delegating and handing off tasks.
Work on your business by systematizing
Another important part of working on your business is establishing and utilizing tools and systems in your business.
Depending on your business model and strategy, you may want to implement systems to streamline the processes. Think about these things:
- What system do you use to track seller leads?
- What accounting system is in place? (Quicken, QuickBooks, for example.)
- What system is in place to pre-screen seller leads that come in? (You could employ a service called PatLive.com for this.)
- Do you use tools like Google Voice and Vumber?
If you are in the wholesale arena, there should definitely be a system for managing how you connect with your cash buyers. Do you call each one of them one at a time when a deal comes across your desk? That would be a terrible use of your precious time! A better way is to have the ability to send out a bulk email to all of them using a system like MailChimp.
The more systems you have in place, the easier it is to bring in other people to help manage these systems while you step out of the way…
Then your team will be able to do those tasks the same way each time, using the same tools, using the same best practices. Streamline the systems in your business so it runs smoothly and efficiently… you get to focus on your highest and best use, while others on your team focus on THEIR highest and best use.
As soon as possible, your goal should be to begin leveraging tools, systems and people/your team to elevate yourself to focus on what you do the best. When you get to that point, you have a business.
Work on your business by thinking about strategy and the bigger picture
Another aspect to business growth is allowing time for you to assess and reflect on where you are now and the goals you want to reach.
I suggest doing this for at least one hour every week – preferably in the morning when you’re fresh. Think of it as your sacred time when you think about business strategy; what you’re doing right; what you’re doing wrong; and cultivating new plans, goals and ideas.
It is crucial that you are intentionally and consistently setting aside time to work on your business in this way. Invest in that hour.
Think you don’t have time? If you’re serious and believe in the value this idea provides, then how’s about this… get up an hour earlier one day a week or carve out an hour on Saturday or Sunday. Doing this can really have a profound effect by acting as an accelerant to your business.
Work on, not in
Look, stop focusing on the tactical stuff and sharpen your business-building skills.
Build your team and place the marketing, accounting and clerical hats on your team members. Ask yourself, ‘What’s the biggest thing I’m procrastinating on right now?’ The answer may be an indicator of the next player you need to add to your team so they can handle that.
Use tools and systems for the day-to-day operations. Set time aside to think about your strategy and you’ll begin to act like a business owner.
By implementing these ideas – you should be able to successfully turn your hobby into a business.
What works for you?
Are there techniques and strategies that you use in building your business? If so share them in the comments below. Your ideas may be the answer someone else is looking for.
Category: Business Management Systems and Tools, Personal Development
Subscribe
If you enjoyed this article, subscribe to receive more just like it.
