Partnerships - Episode 48

Podcast Transcription

Adriana: I got rain boots. Aren't they so cute? I've been dying to wear my rain boots. But right now what I'm gonna go do, I'm gonna go stomp in a bunch of puddles, and play with my boots.

Melina: Welcome to "Flippin Off," a purpose-driven podcast about flipping houses and making a difference.

Oscar: So welcome back. Here we are again guys. We got Frank, John, all aglow, and Tim, and myself Oscar, and today our topic is going to be partnerships. So what I'm seeing right now inside the club is there's a lot of things starting to pick up momentum, where people are looking to work with each other. They're getting to know people within their areas. They're doing a lot of things. Right? And it really put a spotlight, if you will, on what we've done. Right. Like, we're partnered up. You've partnered up with Christian. You've partnered up with a few people. Right? And we've all had partnerships over the course of time here. And we've had success, and we've had some less than success.

Tim: Some great. Some not so great. Right. Yeah.

Oscar: So why not help people sort through that mess ahead of time and kind of share with them some of the lessons learned. What we've done. What we haven't done. Why we didn't do it, and then when we did make some mistakes, what were the [inaudible 00:01:25] things to look out for, that type of stuff. That makes sense?

Tim: Sure.

Oscar: What do you guys think?

Frank: Yeah.

Tim: Yeah.

Oscar: All right. So who wants to go first?

Tim: I would say, my biggest lesson, when it came to partnerships was making sure that I partner for the right reasons. So my first few partnerships were absolutely put together from me being in a space of feeling like I was not capable of doing this on my own. And now I've gotten to a place, where I know I can't do this on my own. Right. I mean, for different reasons, because I wanna take things to the next level, and that's why I'm partnered up now. But at the time, I was doing it from a perspective of not...like, feeling inadequate in taking this business on myself. I had very little success up until my first few partnerships. And I found myself partnering with the wrong people,because I wasn't looking for...I was looking for the wrong people. I was willing to partner with just anybody who would get on my team, so that I...like a security blanket if you will, so that I could feel confident in doing this business. And it turned out that that was absolutely the wrong way to go about doing partnerships for me in particular. Well, at least, my first couple.

Frank: I just think, you say anybody, but I guess, I'm not even anybody. You didn't even approach me, but that's okay. We'll talk about that later.

Tim: Well, that's because from my perspective...

Frank: I wasn't approachable.

Oscar: He wasn't worth it.

Tim: Frank wasn't approachable. 

Frank: There you go. There's that word again. That's fine. I am now.

Tim: But also, like, people like Frank, and people like Oscar were not approachable for me as well. But it wasn't because they weren't in themselves approachable. It was that I didn't feel adequate to go to somebody like Oscar or Frank.

Oscar: That's why I said that...because I remember having this conversation with you. That's why I uttered out he didn't feel like he was worthy of working with us which was so far from the truth. But, so that's a great thing to point out is, that oftentimes we're our own worst critics. Right? So we don't see the great things in ourselves. We, kind of, hang our hats on all the negatives, that are in our life versus really looking at the quality. So sometimes it's just good to reach out to people and say, "Hey. What do you think? What does this look like? And here's where I think I am," and so seeking counsel usually helps in putting yourself in that scenario. Why are you chuckling?

Tim: I am chuckling because I actually sought counsel. I went to Dave and Melina, the founders of the club. And I said, "What do you think about me partnering with these other couple of partnerships that I was getting involved in. And I went to Dave and Melina, I went to couple other mentors, and I think I even talked to Frank about it. And the response was, "Don't do it." 

Oscar: And you still did.

Tim: And I did it anyway, because I needed a security blanket.

Oscar: Ask hole.

Tim: Ask hole. I was an ask hole.

Oscar: I think that I was the one who termed that and we started using that after that. Right?

Tim: Yeah. I was the reason, because that's the reason why we came up with ask hole?

Oscar: So to clarify, Adriana, can you type what we said please, because it's ask hole. 

Tim: I was the original ask hole.

Oscar: A-S-K-H-O-L-E. And the quick definition is a person who asks for information to be given to them, and then they do the complete opposite. 

Tim: Right. That was me.

John: On a kind of different spectrum to that. I've had a couple of conversations lately with a couple of the members of the club talking about, you know, them specifically approaching me to say, "Who do you think I should partner with?" And especially when it comes to the door knocking, the door knocking partnerships, people generally gravitate to somebody that lives in their area, which can make sense for a lot of reasons, because obviously, now you're door knocking with somebody that's within your local area versus the idea of somebody in San Diego partnering with somebody in LA, there's a lot of driving going on there. But at the same time, it does become a balance of finding the right person. And one of the people I was speaking to, he's been afraid to find a partner, to the point where he was actually going out there door knocking on his own. And he was having little success, and he's not sure why. 

John: Immediately my go-to is, when you go door knocking, just your whole attitude, your whole persona, it changes when you're door knocking with a partner. You get to have some fun. You get to have good conversations which puts you in that good spirit, that good mind to then go then have that conversation at the door with a homeowner. Versus you doing it on your own which is...I don't want to say it's kind of boring, but it's kind of boring going door knocking on your own, driving around. You go to the next house, and, you know, but also that perception from the home owner, if you get stuck on a question, where does that now leave you when you are on your own? How much credibility does it give you that now you've got...versus having another partner there, that can now potentially answer that question, bring a different perspective to the table. Sure. Most people have had the same training, but it's still, you know, some people remember more of their training than others. Some are easier to talk to people than others. So I just think, the idea of...for those that are out there trying to door knock on their own, I would generally encourage them to go find a partner. But it has to be very carefully picked or go partner with several people, go find the one that fits. Because I know when I started door knocking, Selena and I, we went with our original coach. Then we went out with three or four different coaches, couple of the more experienced members of the club that weren't necessarily coaches, and eventually we found the person that we fit best with. And then that made sense.

Oscar: Kinda like a try before you buy. 

John: Try before you buy. Exactly.

Oscar: Just to put it in a different way, right. I agree with you. There's dynamics that have to fit and strengths and weaknesses, and things of that nature, that you really have to look for somebody who is gonna create that balance for you and put you forward. What are your thoughts Frank?

Frank: I was thinking when he was talking about the different partners and experimenting with those different partners, and I've had very similar conversations with students, and more along the lines of asking for permission to break off partnerships. "How do I...should I..." I go, "Well, if it's not working for you, it's not stopping you from going out door knocking with somebody else, trying different things. It may not be a time you're both in the learning process department with somebody, is in the same learning curve as you, the idea it makes sense to...like, you just mentioned, strengths and weaknesses. If your weakness is experience, then obviously you need somebody that has experience that you're gonna be a partner with. And that individual that has experience, clearly, they have more ability to choose who their partner would be. So when we were talking about how he was getting partners, someone with experience like myself, I feel like, "All right. What's missing from my team?" And oftentimes, like we talked about my word, being approachable for this year, is find somebody who is more approachable than me, so kind of like yin and yang. Like, I'm very good on off-the-cuff, and joking and saying things in covering the facts and details, but I don't think I have to be. I think for my counterpart going with me, they need to be a little more softer, have a more approachable look. I'm kinda in your face, a little bit confrontational, so my partner needs to not be that, because...

Oscar: Just a little. 

Frank: Completely.

Tim: A little?

Frank: Yeah. As much as possible, I think it's to max, actually, so. But, yeah. The partnerships, you wanna say good cop, bad cop. You wanna say, all these different compatibility, you know, it just comes down to the strengths and weaknesses. And then it comes down to organizational skills. Somebody who is keeping good notes, even...there's so many different things that come into the partnership. And speaking with Tim, when he was talking about a partnership he was looking to create, I was asking him, "Why do you need that partner?" And I'm sure Dave and Melina had the same conversation. And I don't think you could articulate or identify which led everybody to the conclusion of, "Yeah, well, it doesn't make sense to partner then." And a little part was like, "Why is he asking to partner with me?" I'd love to work with everybody at some point. Some experience, I think that's important. But then like, you said, "Try before you buy." I have a student, the one I was talking about, that had this committed once a week partnership to go door knocking with somebody. And they felt like they couldn't break that for anything. And they were not comfortable with the partnership. They didn't think it was going right. Many complaints about that which go along the lines off the strengths and weaknesses. Seems like this person was having to do everything including talk, and all that stuff. So it's, like, just go door knocking with somebody else. You might have to have that conversation, because it might not be serving that person either. But feel free to experiment and try different combinations of partner within our club. 

And I don't know. If you're out there, and you don't have access to a club, obviously, you're, or think we're probably describing something that's a little abstract for you. I know when I first started this, my ultimate goal, you know, the first thing wasn't thinking about was a partner. It was, like, getting mentored and coached by somebody, so obviously, the set up for that was Dave and Melina were training me, so they were going to automatically be my partners. They were pouring into me, they were giving me information. So it was like, "All right. What do I do next?" Right? And then moving forward, my own journey towards being a good partner for somebody else was gonna surround...and I'm still in that conversation. Right? For 2018, I'm still working on weaknesses. But I want to be a partner for somebody that has as many tools and things to present into that partnership as possible. And then what I need, what I'm lacking and I'll still look for those weaknesses. I definitely still have them. So being able to be of value to somebody else is what I'm looking for. I necessarily don't go, "Hey. Who, you know, what are you gonna bring to me by me joint venturing with you?" I wanna be able to say, "Hey, you know, I can bring this to the table. I can do this." That way that person feels good about partnering with me, and obviously, I've identified something in them that's going to complement what I'm doing and that I'm weak in. And again, it goes back to just my approachability and not having a soft exterior and being, you know, just a...I can't even describe it, because it's not me. But I can identify it in somebody else, like, that, I don't have that which I know Tim eventually working around to that thing and also working on that weakness for yourself, so you can bring something to the table as a partner.

Oscar: Right.

John: I've seen some very good partnerships forming, where instead of just picking that person that just makes sense, as I said, because the live close to where you are, in the way of asking for advice from somebody that's already been out there doing it. Asking from coaches, more experienced people who have been through a range of different partners to be able to say, "Who do you think I should fit with." As a great example, I had, you know, a couple of people I was working with, one living in Rancho and one living in LA, and we partnered them up together. Very different people, but they worked incredibly well together. And they had a system that said, "Hey. Let's do your...let's go door knock your area one week. The next week, you drive to me, we'll door knock my area." They were now able to separate the follow ups, because it made sense based on the area where they were. And even though there was a little bit of driving involved, that partnership just worked very, very well. And a great relationship was formed through that partnership, leads started to come to the table, some great conversations were happening, just because it created that real serious bond. So I would encourage people to ask, to reach out to somebody that's been through many different partners, to reach out to coaches, particularly the big [inaudible 00:14:09] here and see what we think,and don't just take...hey. Somebody said, "Hey. Do you wanna go door knocking?" "Hey. Sure. Let's go." There's gotta be a lot more thought that goes into it, rather than just somebody asked me so let's do it.

Tim: For me, I think there's a little bit of a language challenge, when...because we're talking about partnering up. And when we talk about students saying, "I feel stuck in this partnership." At the end of the day, I mean...I've had a lot of what I would now...back in the day I always called them partners, and I felt stuck sometimes. And now I would consider is, I got door knocking buddies, that I might go door knocking with. And we have whatever agreement we have for door knocking, but they're, in my mind now, that doesn't necessarily mean that I'm, quote, partnered with that person. Not until I've put together an actual very detailed agreement, and we've actually decided that we're gonna partner up. And now I only do that once I've determined that that person has skills or strengths, where I know that I'm weak. And like Frank talked about , at the time, back, we're talking seven years ago, I wasn't clear on what my strengths were. In my mind, I was nothing but weaknesses. And I was willing to partner with anybody who I perceived to have any kind of strength at all. And I was willing to, like, commit myself into that partnership, when it wasn't even the best...it wasn't the best thing. And those were the partnerships that I felt I got stuck in or I felt stuck in, because I am, you know, one of my strengths that I realize now is, that I am my word. So when I commit to somebody or something, I can trap myself just by saying that I'm committed. 

Frank: That goes back to Oscar saying about try before you buy. 

Tim: Right. 

Frank: I'm open to anything. I'm open. But I'm also open to saying, "No, that didn't work." I have no problem saying that. 

Oscar: And I think it comes with time and experience. Right. Where you need to be okay, that a no is as good as a yes, in anything that we do. Right. Whether a homeowner says yes or no, whether a partnership says yes or no, or a relationships says yes or no, either way it...because a yes says, "Okay, we move forward now." And a no says, "I move forward now because this isn't working," right? So... Hey Jan, did you have a question?

Jan: Yeah. Well, I know... So what would be an example of an agreement with a door knocking buddy, as Tim described?

Tim: To me that agreement would look along the lines of, "How often are we going to door knock? Are we going to door knock weekly, multiple times a week? What happens with any leads that come out of that? And are we a door knocking buddy, and we go door knocking on Monday, and I'm door knocking with other people on Tuesday, Wednesday, Thursday, Friday, or are we in an actual partnership that no matter what happens inside of my business, I'm partnered with this individual, and no matter what happens inside of their business is, you know, gonna benefit me." 

Oscar: Are you married or dating?

Tim: Yeah. Or are we married or dating. Right.

John: There has to be some conversation there as well, that when you go...before you go door knocking, specifically, in those partnerships, as to what each expectation is. 

Tim: Right. Who's gonna do the follow ups?

John: Who's gonna, as you say, the follow ups. But also the potential for that financial expectation. What if we do find a deal today? What if this lead ends up turning into a deal somewhere down the line? We go buy the house. There has to be something set out from day one to say, what are your expectations? What is it this person can bring to the table versus the next, to say, "Are we splitting this lead fifty-fifty? Or are you, you know, do you have way less experience than I can bring to the table, and that would determine, that you know what? I gonna do more, so maybe I determine more." And I think particularly the club members when they go partner up with somebody maybe they've met here or the club, are they having that conversation, that sets that agreement, before something lands on the table?

Oscar: Yeah. And that's a great point. So inside the club, right, for the club members, we actually have some, we'll call them general agreements, door knocking agreements that, like for example, as coaches, we have agreements that we go into with anybody that we're coaching. But there's also an agreement out there that is for the club members to go out and say, "YHey. You know what? Frank, you and I are gonna go door knock," to your point. Right. "Every Monday at noon, we're gonna go hit the streets, and we're gonna go door knock." And we have a list of the properties that we're gonna hit that day. That's an agreement. It's there. It holds for X amount of time, and we get to move forward. Right. Versus what you were talking about becomes more the, so that's the dating. Right. And then the marriage becomes that it's formalized as a joint venture agreement. It's very clear. I mean, like our agreement is very clear to the point that we can, sort of, [inaudible 00:19:32] said, "Hey. If somebody comes to you with something that has nothing to do with the team, and it's gonna require nothing from the team, then you're consulting with them, cool. Same for me. Right. If I'm consulting with somebody, cool. But it doesn't mean that...but now if in that consulting process, we need to engage our team in it, that changes everything for us because now that becomes a team function, and it becomes a team experience, and so forth. But you just have to, I think, at the end of it all, you have to really walk in with a clear thought process of what it is that you expect to do.Right? What does success look like in that partnership?

And I like what you said Frank, that it's not about taking. Right? It's about giving. What do you bring to the table? What do you give? And what I've found is that I...in my mind, I can say I have these 10 characteristics that I bring to the table. But I have these other 5, that maybe not everybody knows about, that I know now I'm bringing 15 things to the table. Right. And they'll show up at certain times. So it's always giving more than is expected. Set the bar and then exceed the bar is really the way...the best way to approach this, because then everybody is happier. Right. And it works out. So...

John: Touching on something that you said within that was the JV. For those that don't know, who haven't been involved in it, a JV is, as we explained, it's a very simple contract. It's something that sets out everybody's expectations. And a JV within a deal could be very different to a JV within that initial partnership. And we have, I don't wanna say, standardized JVs, but we have different JVs, that we can tweak the wording on, you know, these are contracts that have been written up and drawn up properly to make sure everybody knows what position they stand in. And I often think...because I get asked the question quite a lot. "So if you and I go door knocking, when do we do a JV?" Well, my answer generally is, "Hey. Let's go have some conversations first. Let's go set up some appointments. And if we get into a deal, now we're gonna have a specific JV for that deal." And the next JV that we have for the next deal could be different, could be the same, could be different. But I still have, at least, an agreement with people I'm door knocking with. "Hey. Before we get out of the car, before we go knock on this first door, you and I need to have an agreement of what our expectations are." If a club member comes to me and says, "Hey. John. You know, I expect, if we go door knocking today, that I'm gonna get 60%, and you're gonna get 40%," it's probably a partnership that's not gonna work. Based upon my level of experience, that I feel I can bring to the table, does it make sense, that we're splitting profits fifty-fifty, or does it make sense that it tipples the other way?

Oscar: You get that Christian?

Christian: Yeah.

Oscar: Just letting you know.

Tim: I think there's one other thing that sometimes...like, I know I didn't have this conversation, but there's the conversation about what happens if one partner doesn't live up to what they said they were gonna do? What happens then? 

Oscar: That's the hard part.

Tim: That's the hard part, when that conversation is not had upfront. 

Oscar: Right.

Tim: Of, like, really what happens then, in my experience, the partners that weren't living up to their end of the bargain, they still expected me to pay them their full, what we agreed to upfront, even though they weren't doing what we agreed to upfront. 

Oscar: I remember when you shared that with me and my jaw just, like, [makes sound]. "What the..? How...?" 

Tim: Right.

Oscar: Yeah. I get it, man. And it is a tough conversation . Right. But I think, Dave was the first person that I heard say this. Right. And it was, just negotiate like enemies upfront. Right. And then get that out of the way, because it really...you have to be crystal clear on what's expected of you. Right. And if you can't set those expectations clear enough, then that's where the problems will surface from. It's just the ambiguity or the grey areas, right, that's not clear. 

Frank: So it's our nature to not wanna discuss money issues. So us having something established and so that they can work off of that JV agreement. It's just we have to talk about all the details and areas, what could possibly go wrong, so that we can have an agreement about that upfront. Because obviously, when you go to close the deal, our memories aren't as good as if you had it in writing. 

Oscar: And obviously, you can't capture everything, because then you'd, you know, it would look like the tax code, if you try to capture everything. But it's more about making sure that the big stuff is [addressed and taken care of. And then even putting a clause in there that says, "Hey. When there's a question, maybe we need to bring in an uninterested third party into this to make sure that we have another set of eyes on it, right, to make sure that we're not missing something. Just to clear the air. And it's just good. Right. It is what it is.

John: One of the slogans I carry around in my head now when I'm thinking about partners, thinking about people that I wanna work with, people that I wanna go door knocking with, I still go back to saying the same thing in my own head which is, if I partner with this person, and we go close a deal, we go make some money together, do I wanna go out to dinner with that person afterwards? And if I, for whatever reason, if I don't want to go out to dinner with that person, go enjoy a sociable event, and go celebrate, then probably I shouldn't be doing a deal with them in the first place." Which reminds, me, we need to go to dinner, so, you know, when I'm remembering that. But...

Oscar: Well, I don't eat meat anymore, so it's a cheat day. 

John: It's a cheat day. But that for me is something to live by. I don't wanna partner with somebody that I don't enjoy working with. So, "Hey. Let's go to dinner. Let's go celebrate, if we find a deal." Otherwise, let's probably find a different partner. Probably the polite way to say it. 

Oscar: Agreed. Do we have any questions? 

Adriana: Yeah. Gregory said, "What would you suggest is better, door knocking or bandit signs?"

John: Yes. Yes. I personally, I love door knocking. Well, it's a love-hate door knocking for me. I believe it's the best way for me to find good leads. I believe in having real, authentic conversations, face-to-face with the home owner, versus somebody calling one of my signs and now trying to explain who I am, and really they don't see that authentic person that I can be, when having that face-to-face conversation. At the same time, that doesn't mean to say I don't do bandit signs as well. It's just another avenue.

Oscar: So, I agree. But as a quick disclaimer. We are never at the club going to teach you, where you should put your bandit signs, that you should use bandit signs. Let me be really clear with you guys out there. Okay. There's laws that prohibit you from using bandit signs. You need to be clear on what that city law is, so that you don't get in trouble. It's not about what we do, or how we do it, or any of that. It's about...so to answer the question, either or is fine. Right. If you're door knocking, great. If you're putting up signs, great. But you need to be cautious. You need to be careful. And you need to understand the laws for every city are different. We know, trust us, there's fines. It could be 100 bucks a sign...

Frank: Or 600.

Oscar: ...or it could be 600 bucks a sign? It depends on the city. So...

Tim: Right. 

John: House specific.

Oscar: No. Play at your own risk is what I'm saying. Right. So New Wealth Advisors Club, our businesses, our entities, and all that will never advise you to put up signs. If you choose to do that, great. Just be aware of what you need to do. The people that we've worked with in the past, that have put up signs, they would put them up Friday and pick them up Sunday. Right. So they're out over the weekend, and then they're down again. That's probably one of the safest bets. But again, you need to check the local laws to make sure that you're playing by the law. Yeah. And legal author.

Tim: I can address that question a little bit. I think anything that...first of all,any lead source...I mean, I love door knocking. Door knocking is absolutely, in my mind, the best way to go connect with a homeowner. But any kind of lead source, mailers, anything that has somebody calling you is also good. However, if you don't know how to have a conversation with a homeowner, then you're just throwing money away. You can throw out a million bandit signs and have a million homeowners calling you, but if you don't know how to present an offer or have a good conversation with a homeowner, then you're never going to make any money in this business. So I think door knocking is a great way to go out there for free, talk to homeowners, get good at the conversation, get confident with your abilities and what you know you can accomplish inside of this business, and then and only then go spend money to have homeowners call you, so that you're not just burning cash. 

Frank: Yeah. That's 100% how I started. Door knocking, it means, obviously, you have to get those leads, that cost a little bit of money, but nowhere near what it cost to pay for outside advertising. Just, like, I hated door knocking. I just totally hated it. I was not good at it. And it was because I was, you know, my own experience with people coming to my door, I'm not approachable. If somebody's in front of my door, is like, "Wait. You're in trouble." But, you know, moving forward I was like, "Well, I'm gonna get good at this," and that was 2009. Right. And I did. I would say, it took me about four, five years to get, no. It was about a year process to where I was totally comfortable with the process of door knocking. And then I just expanded. And I started experimenting with...there's so many lead sources. And I find personally for each individual person, that question is very personal to them and again, and again, their strengths and weaknesses which is...what brings us back to partnerships. If you find that you are not good at door knocking, but you're very organizational, good at marketing, maybe your partner is somebody who is great at door knocking, you know, to complement each other, so you have a bigger net and more opportunity to close deals with somebody. And you can bring the same value to them. 

Oscar: Yeah. Absolutely. Great way to bring that question back to the topic right at hand which is partnerships. So, cool. Any last...? 

Tim: No. I'm good. I'm good. 

Oscar: With that I think we're...it's a wrap guys.

Tim: Awesome. 

Oscar: Take care. Have a great week.