Developing “Systems” is not big and scary.
But I watch people’s faces when I talk to them about putting systems into place that help them build and grow their business.
It’s like I just said there’s a really big, scary monster under their bed.
But I get it.
When you’re just starting out, especially as a real estate investor, things can feel overwhelming.[tweet “Developing “Systems” is not a big, scary monster.”]
Let me take your overwhelm away….
A system is something you have in place that allows the business to keep moving even in your absence. You’ll be ready to set your systems in place sooner than you think. It’s time to start putting systems in place right now if…
- You’ve decided on a business for which you have passion. I talk about this in one of my earliest videos:
- You’re wearing all the hats and realize you can’t do it all, which is something I touch on in this fun, short video:
- You’re developing a different mindset. Here’s an older video I produced on your first steps in developing this new mindset:
- You’re going through some amazing changes. You’re developing personally and professionally. This is critical to your success… so critical, in fact, that I produced a short video about it to help you in the process:
- You’re learning who you are as an investor… also known as determining your “Investor Identity,” which is something I talk about a lot in training, because it’s important. Here’s a video I produced that makes it REALLY easy to understand:
You’re just where you’re supposed to be as a new investor.
But soon you will need to put certain systems in place that will allow you to grow your business beyond yourself.
So, let me back up.
What systems do you need exactly? Here are the five mandatory systems you need right now:
1) An effective lead-generation system. Get used to it. To be successful in anything means you will have to put yourself out there to reach as many people possible to let them know what you are doing. This will require in-person strategies as well as an online awareness effort.
The cool thing is that getting out there in the real world is pretty easy. (Even introverts can do it – and I should know, because I am one.)
Why do you think I prefer to conduct business in the middle of a Starbucks or mall vs. hiding away in my actual office? If you put yourself in the proximity of other human beings (i.e., sellers, buyers and investors) the chances are a lot better that you will do more deals faster as I teach students to do, because you’ll be able to spread your message and vision through one-on-one conversations.
When you are talking to strangers from your “away” office location, be sure to invite them to your next Cashflow game. If you don’t have one scheduled there is no better time than right that very moment to check your calendar and pick a date. (One of my BEST lead-generation tools is and remains to this day the Cashflow board game.)
I talk about using the Cashflow game and other real-world lead-generation tactics to grow my business in episode 18 of my Cash Flow Diary podcast. Give it a listen…
2) A solid communications system. Don’t be alarmed by these words. All “communication system” means is now that you are talking to people about what you do and how you can help them solve their problems through real estate investing, you need a way to communicate with them and stay in touch over the long haul.
Let’s start with the basics. Say you just meet a guy at Starbucks and you ask him if he’s ever considered getting involved in real estate investing. He says that indeed he has and tells you why. You are using your very best listening skills. You aren’t jumping ahead or cutting him off. (Refer to last week’s article if you need to understand why this is so important to your success.)
You have a solution for him… or maybe you don’t yet, but now you know that this man’s problem is something you can solve because it is in alignment with what you do as an investor.[tweet “You can solve other people’s problems through real estate investing.”]
If you are prepared and you both have the time, you can ask him if he wants to sit with you to discuss the issue further. Most times, however, people are on their way to another meeting or are pressed for time. That means you have to be prepared to get the other person’s contact information and ask them simply, “Does it make sense for us to sit down and discuss this further over coffee?”
Pull out your day planner (yes, a physical, paper weekly calendar) and open it to the current week. Tell the man what you have open. He’ll tell you what he has available. Book the meeting then and there.[tweet “Income-building tip: Get a paper day planner and use it!”]
After that, you need to enter his information in your database, so you can keep in touch with him. At first, this won’t be automated, but you will want to automate sooner than later. Over time, you’ll get good at automating regular emails and newsletters, sending your leads and contacts interesting articles – even if you didn’t write them – that resonate with them (because you will have bothered to develop a relationship with these individuals), and generally keep in touch.
I talk a lot about generating leads and the importance of developing rapport with sellers, buyers and investors in my live events and webinars. If you haven’t checked any of them out yet, here’s a link to one on what it takes to grab 24 units of property in the next 12 months…
3) A good accounting system.Wealth is a team sport. That means you’re going to have to grow your team. The first person you’ll want to add is a good numbers person. I talk about this in a short video here:
Ideally you want to outsource the accounting functions of your business. Yes, you can do it all, but that can get real messy real fast when you get good as what you’re doing.
Believe me, I know what I’m talking about.
In the beginning of my life as a real estate investor I was a wholesaler. What that means is I bought properties at a discount and I sold properties at a discount. I was the middle man in the transactions and earned a few thousand dollars per transaction.
The bottom line here is that I got really good at wholesaling (because I learned how to generate more leads than I could handle… literally), and in my first four months I had earned a big chunk of change.In fact, I closed more than a dozen deals in that time.[tweet “Wanna earn six figures by this time next year? You can…”]
By the end of my first year in real estate investing I had earned a good six figures. But I wasn’t exactly great at keeping records. (Hey, we all have a weakness; this is one of mine, which is something I talk about in book.)
That’s when I realized I couldn’t do it all alone. I hired my CFO and she’s been helping me ever since.
The funny thing is that from my years of playing Cashflow 101, I knew about the importance of keeping track of your finances and knew how to do great balance sheets. But I wasn’t putting into practice in my real life at that time what I knew I was supposed to be doing.
If you want to get a feel for how you should be handling your finances as an investor, the Cashflow game will teach you. Watch this video and you’ll get a glimpse of what I’m talking about:
In the beginning, you can try to manage your income on your own, but I don’t suggest it. It’s better to hire someone to help you. Start with a good bookkeeper, accountant and/or tax person. As your business grows and your income grows with it, you’ll need a bit higher-level financial person.That’s when you can look at outsourcing financial tasks to a CFO, an expert in all things financial for your business.
This individual can become instrumental in keeping you on track with all you are doing. For me, hiring my CFO was one of the smartest moves I’ve made. Her name is Jennifer Garcia and she answered all my attendees’ questions at my 2015 Round Table Event in Irvine, Calif. The event is recapped in an article on the Cash Flow Diary blog. If you didn’t get a chance to read it, here’s the link:
For the record, you can outsource CFO duties on a contractual basis for around $100 an hour, says Jennifer. Lesser bookkeeping and accounting duties can be found for way less, but also on a contractual basis. You don’t need to hire an employee. However, as you grow your business you need to consider that option.
I talk about this in good detail in my book, Cash Flow Diary: 10 Steps to Creating Wealth in ANY Economy! You can get your free copy right now…
4) An operations systems that helps you handle the day-to-day functions and paperwork.
This will happen over time, but as you build your leads lists of sellers, buyers and investors… as you put into place your communications system… as you add members to your team to help you manage all the different aspects of your business… you’re going to want to hire an operations manager.
Here again, my COO (her official title is VP of Operations) has been with me for a few years and I’d be swimming with my hands tied without her. She helps me manage all our investment decisions and the functions of the investing side of the business.
Why I say the “investing side” is because as Cash Flow Diary has grown I needed to add another side, which I talk about next. That’s marketing, and it’s really, really critical you read what I have to share with you on this point. Without marketing you won’t grow. That’s for sure!
As for getting your operations in place, listen to this Cash Flow Diary podcast episode. It’s an interview I did with my very own VP of Operations, KimBerly Keyton!
5) A marketing system that works even while you sleep. From the start of your business to wherever you are right now in your business and beyond, one thing’s for sure… you need marketing. The longer you’re in business the more necessary it will become to automate your marketing efforts. That means you’ll need certain systems beyond all you’re setting in place now.
Like I tell my coaching clients and students all the time, you need four things to be a success in business… any business:
- Income-generating activities
- Personal development actions
- Business-promotions activities
- Presentation actions
In short, if you get five new YES’s a day, it’ll keep poverty away![tweet “if you get five new YES’s a day, it’ll keep poverty away!”]
Want a crash course on this line of thinking, watch this short video meant to jump start your marketing efforts: I recently finished leading a 12-week Digital Marketing Mastermind that taught participants everything I’ve learned about digital marketing in the past few years. It was amazing!
The people in the room – well, online with me anyway – live each week are still giving me feedback, asking questions about setting up their landing pages, optimizing their websites, using opt-in’s and ads effectively, funnels and more. They’re getting great input from other members in our private Facebook group and, in short, they’re putting everything they learned to good use. (I love watching their growth!)
Here’s just a taste of what that looks like in our Cashflow Creators page (that’s what we call it because that’s what we are all doing as members):
A lot goes into creating good and effective marketing. That can be an article on its own. Suffice it to say that once you know your Investor Identity and whom you will serve, it becomes easier to share your message and vision.
How you share that message in the real world may look different than how you go about it online, but the bottom line remains the same. You are sharing with cold, warm and hot traffic how you can solve their problems through real estate investing.
As you might expect, I produced a short video to help you with your marketing and developing the voice you need to spread your message effectively:
BTW, if you don’t know the difference between cold, warm and hot traffic, it simply has to do with how well your prospects and customers know you, if they know about you at all, how you get them to know you better, and how you get them to participate with you the first time and then many times thereafter.[tweet “Good marketing means knowing the difference between cold, warm and hot traffic.”]
Marketing to the different traffic streams is something we’ve gotten pretty good at over the past several months. So good, in fact, that we’ve been invited to share our story with the good folks at….
Oh, snap, I can’t tell you yet!! (But stay tuned. As soon as our case study is available I’ll give you the link.)
If you’ve gotten this far in the article, I’m proud of you.
- You’re obviously serious about building and growing your real estate business.
- You now know that minimally, you need a customer-acquisition and lead-generation system.
- Over time you’ll need to build a team, because you don’t get to your biggest goals alone.
- And you know that you need to automate your processes, especially your marketing, to keep leads and income flowing in even while you sleep.
If you still need a little motivation, watch this video: What I didn’t go into in this article is that once your business gets to a certain point and you’re earning consistent income while at the same time continually growing your leads lists, you’re also going to need to add a customer service leg into your operations, as well as asset and legal protections. But that’s a topic for another time.
Once you put even your most basic systems into place you’ll notice something pretty cool will start to happen. Your income will stabilize![tweet “Your income will stabilize once your systems are in place.”]
While I’ve done my best to summarize the systems you’ll need to be the biggest, baddest, best real estate investor you can be, you may still have questions. You can find a lot of answers by reading the blog here on this site and by listening to my podcast.
If you haven’t yet subscribed to my Cash Flow Diary podcast, you can do it easily and quickly through this site. You’ll also find lots of cool, free information, like The 39 Perfect Places to Find Investors…
AND I’m always here if you have questions. In fact, I’m just a click away: