“If I look back at what I was doing wrong, and here’s what I was doing wrong in a nutshell, I won’t spend tons of time on it. I’ll spend a little more time on what I did to fix it.”

-Mike Simmons

 

Mike Simmons  is an entrepreneur, a business coach / mentor since 2013 and has helped several entrepreneurs start, build and scale their businesses to 7 figures. As a master of taking strategic risks, he coaches others to do the same to love and become unstoppable with this program called convincing me. Mike has personally worked with hundreds of entrepreneurs to take strategic risks that have paid off. He has shared the stage with Gary Vaynerchuk, Ryan Serhant, Russell Brunson and among others. He’s also been featured in Business Insider magazine, and produces and hosts the podcast, Just Start Real Estate where he interviews successful entrepreneurs. Mike is also the author of Level Jumping and this book is about generating a profit of $1 million and his business in just 12 months.

 

In this episode, Trevor and Mike discuss:

-Mike’s real estate background and why he started this business.

-What made Mike leave his corporate job.

-How his mistakes made him reach a million dollars within 12 months.

-A few key points about Mike’s path to a million dollars.

-How podcasting can help you connect with others and expand your network.

-The importance of creating a system and process in a business.

-What the deal looks like in the new market.

-Excellent advice when fixing and flipping.

-The benefits of joining a coaching program.

 

Listen to all our episodes and leave a review: HERE

 

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CONNECT WITH MIKE:

Website | Podcast | LinkedIn | Twitter

 

BOOKS RECOMMENDATION:

Traction: Get A Grip On Your Business | Extreme Ownership: How U.S. Navy SEALs Lead and Win

 

CONNECT WITH TREVOR:

Links:

Website | Instagram | LinkedIn | Facebook

 

Email us: Trevor@podcastingyou.com

Full Transcription Of Today’s Episode

Trevor Oldham  00:43

Hey, everybody, welcome back to the real estate investing exposure podcast. Today on the show, we have Mike Simmons. He is an entrepreneur, seven figure real estate investor and his partner and one of the country’s largest real estate mentorship/mastermind companies. As a master of taking strategic risks. He coaches others to do the same to love and become unstoppable. With this program, it’s called convincing me. Mike has personally worked with hundreds of entrepreneurs to take strategic risks that have paid off. He has shared the stage with Gary Vaynerchuk, Ryan Serhant, and Russell Brunson among others. He’s also been featured in Business Insider magazine, and produces and hosts the podcast, just start real estate where he interviews successful entrepreneurs. And Mike is also the author of level jumping. And this book is about generating a profit of $1 million and his business in just 12 months. Mike, super excited to have you on the show today.

 

Mike Simmons  01:38

Yeah, happy to be here, man. Thanks for having me.

 

Trevor Oldham  01:40

And Mike, for the audience out there. They’re learning about yourself for the first time, I love for you just to hop into your real estate background and why you started to get started into the business.

 

Mike Simmons  01:49

Yeah, for sure. So I was working at a corporate job, not unlike a lot of people, right nine to five jobs in a cubicle. And like a lot of people I wasn’t happy. And I started trying to think the first thing I did was I started calculating mathematically how long it would take me to retire at the rate I was going right? And I realized, like, I would be in my mid hundreds, like I’m never gonna be able to retire. I’m just not making enough money to save enough to be able to sustain a certain style of living. And so I started getting a little bit anxious about that. And so I thought, what the money that I do have, how can I make that better work for me? How can I invest my money? And for me at the time, it was stocks like day trading, and how do I get into the stock market and really kind of blow it up and make and make my money work for me. And as I started investigating the stock market and stocks and how I can do that, it became apparent to me in a short amount of time that I didn’t do anything I hated worse than my day job was learning stocks, like I really didn’t enjoy it. But if you google investing, and you Google how to invest for retirement, eventually, you’ll hit real estate. And so I found real estate. And I started reading up on it. And I started reading success stories. And I was like, I was totally into it. Like I loved it. I never got tired of reading about real estate, like I did get tired of reading about stocks and stock trading. So I started going to seminars, local, you know, local stuff, some meetups and really buying books and all the things that you do, and I made a decision. And this is important. If you listen to the dates, I made a decision in 2003 that I wanted to be a real estate investor. That’s what I wanted to do, like, ultimately full time. That’s what I wanted to do. I didn’t buy my first property until 2008. Okay, so there was a five year period where I sat in fear, I doubted myself, I made excuses. I got into a lot of paralysis analysis, or analysis paralysis, I should say. And I just was doing everything in the world, except actually getting started and actually doing the thing that I wanted to do. And I hid behind excuses, like, you know, I’m trying to do my due diligence, I want to make sure that I’m educated, it’s a lot of money, like I don’t want to take a risk. And it was just all Bs, it was me being afraid of screwing up and losing money and having people see me do it and fail. So I sat on the sidelines for five years until I finally hit rock bottom and came to a point where I was so disgusted with my job with my career with my fear of getting started, that I started making offers, right, which is really the first step like in real estate. If you’re not at least making offers like you’re not doing anything. I’ve got a friend of mine who approached me about three or four years ago, and he said I want to start flipping houses. And he said, Can you help me? I said, Sure , I help hundreds of people. I can help you for sure, my friend. So I started laying it out for him and I gave him a great plan. And you know, six months later I talked to him like How’s it going? Oh, you know, I said have you got any deals yet? No. And I said how many offers Have you made now A year later, same answer. If I asked him today, I would get the same answer. He hasn’t made any offers. And so, you know, what I realized was getting started is half the battle, like just putting one foot in front of the other. Like, if you want to run a marathon, you have to get off your butt, put some tennis shoes on and get out, like you have to get out there. And that’s the biggest horror of horror for most people, most people would rather complain than actually do something about their problem. And I just got to a point where I hit rock bottom, I couldn’t, I couldn’t complain anymore, because no one wanted to hear it. And I was just sitting here myself and I started making offers and did my first deal. And you know, at the time, it was 2008. Right? So you know, what was happening to the market in 2008-2009. Everything was crashing. So I did my first deal and made a ton of mistakes. But I made $15,000 on a $40,000 house, I made $15,000. And for me, that was more money than I had ever made in my life. At one time, it was insane. And for my wife who grew up really kind of poor, and I was sort of like middle lower middle class sort of upbringing, like it was more money than we’d ever seen at one time. And we learned a ton but most importantly, the number one thing that we got out of that first experience was, we got over our fears, we realized all of the things that we thought were worst case scenarios didn’t happen. And they weren’t likely to happen. So you know, it’s sort of like when you bring a kid to the amusement park or, you know, roller coasters, and they’re afraid to get on the roller coaster. They’ll fight, they’ll argue, but if you convince them to get on the roller coaster, when they get done with it, nine out of 10 kids will go. I want to do it again. Right. And that’s kind of how we were. We were deathly afraid we did it once. And then we were like, Oh, we want to do this again. And we kind of took off from there.

 

Trevor Oldham  06:46

That’s an excellent overview for the audience. I could imagine that there’s people in our audience that are listening and are interested in doing that first deal. And they may sound like your friend, maybe they you know, six months gone by 12 months and and now they’re looking five years down the road, and they still haven’t made their first offer. So I love those. I love those analogies that you’ve used. But as you you know, as I was going through your bio, and reading it off, and you know, you’ve crossed the million dollar mark, but in the first 12 months, that’s that’s a significant amount of money that’s just not flipping, you know, say, a couple of houses. How are you able to cross that mark? Did you have to put the teams and processes in place? Do you mind just walking our audience through some of those experiences?

 

Mike Simmons  07:22

Totally. And let me clarify, I got to, I got to a million dollars within 12 months, it wasn’t my first 12 months, okay, so I was doing I was flipping houses and doing real estate poorly for a couple of years before, I sort of dialed in and understood what I was doing wrong. And I’ll tell you the number one, if I look back at what I was doing wrong, and here’s what I was doing wrong in a nutshell, I won’t spend tons of time on it. I’ll spend a little more time on what I did to fix it. But the thing that I was doing wrong was I was reinventing the wheel. Every time I did a flip, I was going to Home Depot, I was picking out new flooring, new paint, like I was everything was like a brand new experience. I wasn’t there was no economy of scale, because I wasn’t repeating anything. I had no process, my wife would do some things, one flip. And then the next time I would do some of those things. And she would do some of the things I was doing last time like we were crossing over responsibilities like crazy. And you know, in a company, if everybody’s responsible for something, nobody’s responsible for that thing, right? So you have to be very, very dialed in. So what I did was, I started a podcast, right? When you’re listening to a podcast, I started a podcast back in 2013. And it’s not the podcast that made all the difference, but it’s the contacts and the connections that I made as a result now, do you have to know our podcast? No, you don’t have to. But what I what you do have to do in real estate, in my opinion, is you have to network, you really absolutely have to get into that world, go into the real estate world and start meeting people talking to people get to know people, exchange ideas, you know, share with them what’s working, what’s not working, because through doing that, I made a connection with a person who lived in California still does. And he was flipping 100 houses a year in Southern California. I was in Michigan doing like five to eight a year at the time, you know, and I was one of the more successful flippers in my local market, which is a problem too. You don’t ever want to be the biggest fish in a small pond, right? You want to be a smaller fish in a big pond. So I knew this person in California flipping 100 deals a year in Southern California. He was bored stiff, he had more time than he knew what to do with which blew my mind because doing eight deals I was running around like crazy. And he at one point announced to me then some folks that he was going to start a mastermind and he was going to get together some successful ish or mildly successful people from around the country. Get them in a room and Let’s exchange ideas and let’s mastermind right and I did that. And through doing that I met people who were doing 20 deals a year. 50 deals a year 100 deals a year more than 100 deals a year. And the magic of that is, I got to sit with some of these folks and deconstruct their business a little bit. Like ask them what exactly they’re doing, how do they run their business? That’s how they market? How do they track their marketing? Who do they have on their team? Why did they hire those people? What do they pay those people? What are the systems and processes? And so in through that process of really talking to people, there were a few key things that came out of it. Okay. And your question was, how did I get to that million dollars? What happened? Number one, I joined a mastermind, okay, that was number one is huge to surround myself with people who were achieving at a higher level than I was an absolute game changer. But what the things that they taught me, there were a lot of things, but the biggest things they taught me was systems and processes, right? Have a system or processes in your business. Now, if you’re, if you’re small, and you don’t have this robust system, it’s fine. Because whatever you are currently doing, that’s your system, and you need to document it. And it doesn’t have to be long form manual pages and pages. Just start off with bullet points. How do you go about finding deals like, list all the things you do to find deals? And then when, when, when a seller calls? Or when your marketing produces some kind of a lead? How do you handle that? Who answers the call? Who takes that lead? Who talks to the seller? What are the things you try to find out from that seller? When you go to the appointment to actually talk to them about buying their house? How does that look? And then if you’re a wholesaler, what do you do? Once you get the contract? How do you find a buyer? If you’re a flipper? How do you find a contractor? Do you have a contractor? How do you go about hiring contractors? What do you look for when you hire a contract, right and just start making bullet points of what you’re doing? It’s rudimentary, but it’s something because the reason you do that is to get very clear. So when you do start bringing people in, you have something to show them. Because if everything’s in your head, that doesn’t help anybody, right? So systems and processes were huge, because like I told you in the beginning, every time we bought a house, we were just reinventing our process. We weren’t following anything standard. It wasn’t like my job to do this, my wife’s job to do that. It was like, everything was everybody’s job. And you can imagine when you do that things fall through the cracks. So systems and processes were number one. The next big pillar or the next major takeaway from sitting with successful people. By the way, people who are doing 8, 10-15 deals per month are tracking your numbers, we call them KPIs or key performance indicators. Some people call them metrics, tracking the most important numbers in your company. So you know what’s going on. KPIs to a business are like an instrument panel in a plane, right, it’s possible for a pilot to get in a plane and get it in the air. Without instrument panels, it’s next to impossible to fly safely in the air without an instrument panel in front of you without all the indicators. And it’s the same way in business you can do a deal, you can flip a house, you can buy a bunch of rentals, you can wholesale, some deals, you can get money flowing, you can get the cash flow going. But if you’re not tracking what marketing’s working, how many calls does it take to your marketing for you to get a contract? What is your average contract, what is your cost per contract, some of these basic numbers, you will eventually most likely go out of business unless you are one of the luckiest people on earth. And you just happen to figure it out organically and intuitively. But for most of us, we need to understand what’s going on in our business in order to tweak it and keep that plant that metaphorical plane in the air. And so I learned how to track numbers and just for your listeners, if you’re like, well, what numbers do I track? There’s a million numbers you can track okay, but at a very high level. What I tell people the numbers you should know at a bare bare bare minimum is how much money are you spending on marketing? How many leads is that marketing producing? How many leads does it take to get an appointment? How many appointments does it take to get a contract? What’s your average contract value? And then what is your total revenue? Like if you just have those basic numbers, it’ll give you some indication of not only the effectiveness of your marketing, but the health of your business and a lot of those things in the middle like how many leads does it take to get an appointment? Well, that metric will tell you in a very basic, high level way, how effective your phone people are like if you’re sending out direct mail or PPC or whatever it is, and that’s generating calls, inbound calls, well, if it takes you, you know, 10 leads to get an appointment versus maybe 25 leads to get an appointment, you can kind of see if your lead intake if your phone people are actually being effective. How many contracts does it take to get in a deal, right? Well, if it takes you three, I’m sorry, how many appointments to get a contract if it takes you three appointments to get a contract. That’s pretty good. That’s about where we are. If it takes you 20 appointments to get a contract, you may have an acquisition problem, right? So these basic numbers are how we run our business. Now we dial them in a little bit more granular for each position in our company. But knowing your KPIs is absolutely non negotiable, no brainer. And then the last thing that I would say that was huge that made me talk about the things that move the needle in a big way. The third thing would be how and when to hire, because my limiting belief before I surrounded myself with successful people was, I’m too small to hire, I don’t have a big enough business to actually start hiring people. But the catch 22 was, I knew I would never be as big a business as I wanted to be doing everything myself, right. So if you have this logic, I want to be a $10 million company. But I can’t hire because I’m only a $500,000 company. But I can’t become a 10,000 or $10 million company, until I hire more people like it’s circular logic, it’s you can’t win, right? So I learned how to hire the team for my company as it is now and how to scale that up, who to hire first, how to compensate those kinds of people, and what that looks like for a growing company. Because there’s two hurdles when you’re trying to grow your company, their scale, and then they’re scaling profitably. And too many people focus on the scale. And they don’t focus on making sure that they’re staying profitable while they do it. And I can tell you, I have been in that club too. I have scaled in the past, at the detriment of actually scaling up my my revenue or not my revenue, but my my net, right? So you could, I mean, it goes back to that old thing. Would you rather have a million dollar company that makes $100,000 in profit, or a $150,000 revenue company that makes $100,000 in profit? Like, it doesn’t, it’s, it’s sexy to say you make a million dollars, but it’s all about what you keep. So I really, really learned how to keep an eye on and maintain that profitability.

 

Trevor Oldham  17:04

Yeah, I think that’s an excellent point. And something that I can definitely attest to myself. And then when looking at the numbers, I always wonder like, no, is it better to bring on more clients and have more employees? Or is it better to stay small? And say, yeah, as you mentioned, like, you know, have 100,000 revenue in a month, and then 20,000? Or is it better to have 30,000 in revenue, but only 10k? and expenses and net? That same? 20,000? So I think that’s an excellent point. Yeah, for the audience and as you’re going through this business, since the pandemic started, and, and, obviously, housing prices around the country have, you know, increased, you know, in some in some markets quite a bit. And from your experience, when you’re going out and, you know, trying to flip houses over the past, say, 18 months, have you noticed that it’s been harder to find good deals, how has been your take, you know, interacting with sort of the new market that’s out there?

 

Mike Simmons  17:50

Yeah. It’s a good question. Is it harder to find deals? The short answer is yes. However, what happened with me and my business, and other people may have experienced this too. And it kind of underscores the importance of KPIs is, for me over the last six years, well, let’s just say, from 2016, through 2020, or 2015, to 2020, let’s say, direct mail was hands down far and away the juggernaut of how I got my deals or my leads, right, I would say 80% of the deals that I’ve done in the last five or six years have been through direct mail. But when the pandemic hit, I’m in Michigan, and states were hit differently. Michigan was hit pretty hard, and we clamped down really, really hard. And so when the pandemic hit, there was a there was an actual fear if you guys remember, some of you might remember, there was a fear and questions around Should I touch my mail? Can I get COVID from touching mail? And so once COVID hit in Michigan, we were hit so hard, that my direct mail, the effectiveness and the calls and the leads that I was getting dropped off a cliff, it went from like, super busy to like nothing like crickets. And I was like, What happened? The only thing I can figure is that it was directly in line with when the pandemic got, and all the paranoia about touching mail is that people just started not touching any mail that they weren’t 100% critical of. So we slowed down and eventually stopped doing direct mail in 2020. But what we noticed was people were at home, and they were scared and they were panicked. And when they do I sell my house, what do I do? So people started typing into Google to sell my house fast in Michigan. And so for us pay per click became much more, you know, profitable and much more busy than it had been the previous year because people were shifting, everyone was home. People were shifting to searching for ways to sell their house online. And so we stopped doing direct mail and PPC started hitting now. So for us, that shift was made and we never really shifted back yet we’re starting, we’re just now starting to introduce direct mail back in. But PPC has been ridiculously good for us. But I want to make the point because you asked about the market and what I am dealing with in its new market. I like that you said new market, because some people will say, we’re in a really, really good market. Right? And good is from the perspective of who’s who you’re talking to. If you’re a buyer, this isn’t a good market. This is a terrible market if you’re a buyer, because all the prices are higher, and they’re bidding wars and you have to over bid and all this stuff. If you’re a seller, the markets are good. So the market itself guys, for all of you listening, please take a pic, take this away, the market is never good or bad that those designations don’t apply to the market, right? It’s like a hammer is a hammer, good or bad. If you’re trying to drive a nail into a piece of wood, a hammer is good. If you’re being chased around the house by someone crazy swinging at you. It’s bad, okay, but the hammer is not good or bad. It’s just how it’s being used. So the market is not good or bad. But knowing what market cycle you’re in is everything. It’s everything. If you think you’re in a market that’s declining, and you think that’s the case, but you don’t realize it’s actually going the other way, you’re going to buy wrong and you’re going to sell wrong. So right now, people know that they can sell their house for a lot of money. So is it harder to buy houses on the front end at a discount? Yeah, a little bit. But if you’re flipping and if you’re a flipper, listening to this, you know, as well as I do, whatever you thought that house would be worth in four or five months, it’s probably worth more than you thought it was going to be. So if you buy a house for 60, and you think you’re going to sell it for 120, chances are four or five months later, it’s worth 150 or 160. Right? So it’s great from that perspective. So you just have to understand where you are. So that you know right now, because the markets are hot, you might and I say this with a lot of caution. So listen carefully, you might be able to spend a little bit more acquiring that house than maybe you would have a year ago, because you know, on the back end, there’s a pretty good likelihood the market will be strong, if you’re flipping and you’re in and out of it in three or four months, okay? If you’re speculating, if you’re buying, you know, houses, you’re building houses from the ground up, you’re developing land, and tap the brakes. Because what happened in 2008, was all those folks who were speculating and developing, got pretty burned when the market crashed, right, because they had long term investments. But if you’re wholesaling and you’re flipping, and you’re flipping at a pretty good rate, you know, you can spend a little bit more, but when the market turns, and it probably eventually will, because it always does, you have to be real careful, you might have to spend a little less on the acquisition, because you know, once you’re done flipping it, it’s going to be worth a little less because the markets going down. So knowing the market cycle is way more is way more productive and effective than putting a label of good or bad on it. Because it’s not good or bad. It depends on who you’re talking to.

 

Trevor Oldham  22:58

Yeah, I think that’s, I think it’s excellent advice to her audience, but not like I want to hop into your coaching program that I had mentioned, as I was going through your bio and, and the name convinced me really, really is intriguing. I love for you to walk our audience through what that coaching program looks like. And we’re able to do it for individuals.

 

Mike Simmons  23:16

Yep, totally, thank you for asking. So it’s a coaching program, I’ve never offered a product in any way, shape, or form. I’ve been on a podcast, I’ve been helping people for years, and I’ve never offered anything that was paid. So this is the first time I’m doing it. And I really believe in it. And the reason I called it convinced me is because most people are doing it. I know that the vast majority of people out there are doing what I did for the first five years or so, which is you’re learning, you’re gathering information, you’re getting ready to get ready and you’re not doing it right. And the reason why you’re not either starting your business, or maybe you did start and you’re having trouble scaling, the reason you’re struggling in those areas is because number one, you don’t truly believe you can do it or you would be doing it. So for the people who haven’t gotten started yet. If you’re honest with yourself, and I can’t see you and I don’t know your name, and I don’t know your background, but just look at yourself in the mirror later today if you haven’t gotten started, but you want to and be truly honest with yourself, do you 100% believe that you can do it? And do you have a plan to make it happen? Okay, so they convinced me theory or they convinced me a model is and it’s sort of tongue in cheek, right? Do you have to convince me that you can do this? No, that you don’t, right? But if you can’t convince me like Allah Shark Tank style, if you can’t convince me that you not only believe in yourself, but you have a plan to get it done, then you don’t believe in yourself and you will not get it done because you don’t have a plan. So what I try to do with people, is give them that self belief that they can actually do it. We do that partially by helping give them a plan. Because once you have a plan, the belief is a lot easier. But people try to put the belief before the plan. And sometimes the plan comes before the belief. So I want to help provide you with that plan. So you believe it. So you’re convinced. And then the next step is convincing your loved ones I didn’t tell my friends and family that I was flipping houses until I’ve been doing it for a couple of years. Because I didn’t, I still was sort of like not really believing in myself. And it showed in the production and the amount of volume I was able to do. So I want people to not only believe in themselves and have a plan, but I want them to be able to articulate that to the people in their life that they love and care about the most. Because that support if you’re married and you’re trying to do this business, and your spouse is not or your girlfriend boyfriend is not supportive. And in fact they’re kind of working against you. Again it becomes next to impossible to succeed when everyone is pulling against you. So I want to empower people with a belief. I want to empower them with a plan and then I want to give them the talking points in the confidence to talk to their loved ones to make it a reality.

 

Trevor Oldham  26:04

That definitely sounds like an awesome program. But Mike, I want to be respectful of your time today. I just have a couple additional questions. I wanted to ask Cory hop off today. The first question is do you happen to have a favorite real estate or business book that you’d recommend for our audience to check out?

 

Mike Simmons  26:21

Okay, I’m going to name two once, once a business book or in one a real estate book. Well, really both business books but I like traction by Gino wickman. It’s how I run my business. It’s called the EOS entrepreneurial operating system. It is a fantastic simple, easy to follow plan for how to structure and run your business that I highly recommend to everybody. The second one is called Extreme Ownership by Jacko Willink, a great book. I think honestly, if the whole world read that book, we’d all be better off because the gist of it is don’t blame other people for anything, anything happening in or around you do not blame other people take ownership take Extreme Ownership of what’s happening around you and you will have much more success if you adopt that philosophy then folks who typically get into the process of complaining and blaming everybody else for the problems it’s not the government it’s not the president it’s not your religion. It’s not your race, no none of the things you have total control of yourself and that’s who has to take responsibility.

 

Trevor Oldham  27:19

I think those are two awesome book recommendations. And the last question of the day for you is to where can our audience find you.

 

Mike Simmons  27:27

Easy way you can go to Mike simmons.com You can find everything I’m up to there of course I have a podcast called just start real estate. So if you’re already on iTunes or Spotify or something you can just type in just start real estate. You can find me there.

 

Trevor Oldham  27:40

Awesome. I’ll make sure to include that in the show notes of today’s episode. And like I just want to say thank you so much for hopping on to the show today.

 

Mike Simmons  27:46

Awesome, man. Thanks for having me.