MAR 5, 2022
Now that I think about it, I’ve never met anyone that went to school for ‘sales’. It’s so peculiar - I’ve only ever worked in sales jobs but have yet to meet anyone that actively sought out sales after finishing school. Even me — I only took my first sales job because I wasn’t qualified for anything else, LOL. Best mistake I ever made.
Sales is fun, it attracts a plethora of personalities; all with competitive & entrepreneurial dispositions — we like to win and close deals :)
I was thinking about my journey into sales because of a conversation with my brother. He’s at the halfway point in undergrad and is juggling the questions we’ve all had: What am I supposed to do with my major? Should I switch? Am I doing the right thing? This gave me comfort, usually people that are worried about making the right decisions are better off than those that wait for life to happen.
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The last couple of weeks have been draining. Between a fully packed weekend of a conference, client meetings, and my day job; I had a breakthrough. I’ve realized it’s impossible to be deeply focused on more than 1 thing at a time — we’re not built to multitask. We can quickly switch focus between things, but that has a diminishing rate of return because inefficiency increases; leading to a lackluster execution.
‘Do 1 thing extremely well, or multiple things eh.’
I concluded that working at a job isn’t what I want to do anymore. It sucks for me to build something for someone else’s vision. I’d rather make less building my own thing.
But I’m not delusional. I know things cost money. I’ve decided to allocate more of my time into RE activities that will generate quicker cashflow while searching for a commercial deal to buy. 2 activities that someone new to RE can use to build a war chest are: wholesaling, and being an agent (Realtor).
(1) Being a realtor is self explanatory, you help your customer buy or sell their property and earn a commission based on the final sale price.
(2) Wholesaling real estate is like arbitrage. You buy a piece of property and sell it to someone else for a higher price; we pocket the difference. Here’s an example:
David wants to sell his house for $100k but doesn’t want to list it on the market, since that would take a while to get his money. David’s house could sell for $125k if he put work into it, and was patient — but David wants neither of those. Enter Mo: I offer David a $75k purchase price for his house with the promise to close in ~ 2 weeks. David accepts & we sign a contract.
I immediately take my contract and contact my private buyers, who invest in underpriced properties — my buyers like me because I find off market deals. One of my buyers is willing to buy the property for $90k, put $10k into it, and flip it for $125k. Fantastic, I ‘assign’ the contract to her for the price difference of $15k ($90k - $75k).
Initial contract price: $75k
Assignment price: $90k
Mo pockets: $90k - $75k = $15k
After-Repair-Value (ARV): $125k
Investor profits: $125k - $90k - $10k = $25k
David receives: $75k, peace of mind, and a quick close.
Economy receives: Real estate investment, property remodeled and sold to a retail buyer.
Wholesaling is really attractive to me because there’s a lot of mimicry between its sales process and what I’m used to in software sales: rapport building, prospecting, closing, contract signing, etc. So I’ve been aggressively diving into learning material on how to wholesale and exactly how to find the deals to then profit from an assignment fee. I’ll write about my findings in the coming weeks.
The way I look at it, going in to work for myself could work out really well, or go horribly. Either way, I get a pretty neat story out of it and get to learn a lot of things!
