Discover Cash, Companions, & Offers Utilizing The “D.A.D System”

Ashley Kehr:
That is Actual Property Rookie episode 132.

Mike Michalowicz:
If we’re higher within the competitors but nobody finds us, they discover the choice, the purchasers are getting a disservice and so they’re experiencing one thing that’s inferior as a result of we’re superior. And if our purchasers are experiencing one thing inferior that’s their downside, it’s our fault however not advertising.

Ashley Kehr:
My identify is Ashley Kehr, and I’m right here with Tony Robinson.

Tony Robinson:
And welcome to the Actual Property Rookie, the place we provide you with all the data, all of the inspirational, all of the training it’s essential get began in your actual property investing journey. And generally we speak in regards to the nitty gritty about actual property investing, different instances we speak about issues which may assist your actual property investing profession. And that’s what we’re going to do at this time.

Ashley Kehr:
So, this Saturday is a Rookie Reply as regular, however we’re doing it a little bit bit completely different. Occasionally we do have a visitor on for the Rookie Reply. And at this time we now have Mike the creator of Get Totally different and he’s going to speak to us about advertising. And he’ll really go into why advertising is necessary for an actual property investor.

Tony Robinson:
And he’s bought so many truly good factors, simply all collectively. Truthfully, I bought launched to Mike Michalowicz by his ebook Revenue First. I’ve talked about within the podcast earlier than, if you happen to guys haven’t learn that, undoubtedly I encourage you guys to go choose it up. However at this time he began to speak about his ebook, Get Totally different, which is about advertising. And I do know you is perhaps considering like, “Tony, Ashley, why are we speaking about advertising on an actual property podcast?” But when you consider it, there’s so many actions in your actual property investing enterprise that require you to face out amongst a crowd of different buyers. And that’s what the premise of this dialog is. And he goes over completely different frameworks you can observe. He provides you step-by-step recommendation on find out how to make your self stand out. And actually simply to find out how to begin framing your individual conversations with your self about advertising, about being completely different, about standing out that can allow you to in your actual property enterprise for positive.

Ashley Kehr:
Yeah, we really actually jam pack so much into this brief episode. We go from speaking about how to not be a (beep) and don’t be a (beep), to speaking in regards to the dad advertising technique, to speaking about me popping out of the closet as soon as once more. And likewise, I rudely interrupt Tony. So, plenty of issues occur throughout this brief episode on this week’s of Rookie Reply. So, let’s convey Mike onto the present.

Tony Robinson:
Mike Michalowicz, thanks a lot for becoming a member of us, man. I’m tremendous pumped to have you ever on right here. And earlier than we get into it, I bought to say that I’m fanboy in a little bit bit as a result of I’ve learn a few of your different books and so they’ve had a big effect on my life. However Mike, for the listeners that don’t know you, please simply give us like an introduction of who you might be, what you’re about, and form of what your mission is in life.

Mike Michalowicz:
Yeah. So it’s Mike Michalowicz right here. I used to be really trying on the mistaken digital camera. I’ve two cameras and my fundamental digital camera broke. So I’m on my backup. And I used to be like attempting to stare you down within the mistaken cameras. Now, there you go.

Ashley Kehr:
Oh, there we’re.

Mike Michalowicz:
Now, I bought it, the backup. So I’m an creator man. I write books about small enterprise, however my journey has been entrepreneurial. I’ve been entrepreneur my complete grownup life. At this time, I personal two corporations. I’ve 4 licensed corporations. So six collectively that I’m serving to handle and run. However my actual… And I’m captivated with these companies. I’m a little bit passionate in regards to the entrepreneurial journey, as a result of I’ve struggled in it and I’ve been very profitable in it. And I’ve seen the highs and the lows. And I believe there ought to be much more highs for entrepreneurs and so much much less lows. My purpose is to eradicate what I name entrepreneurial poverty.
What I imply by that’s there’s a imaginative and prescient that Tony, Ashley, all of us had after we began our companies. Then there’s a actuality whenever you began. And it’s often a reasonably large hole. I’m personally free. I can do what I need once I need. I’ll be financially free. I’ll make all the cash on the earth. And it’s like, “Oh my God, I’ve no cash and my life sucks. All I do is figure.” That hole is what I name entrepreneur poverty. And thru the work I do as an creator, my mission is to eradicate entrepreneurial poverty.

Tony Robinson:
I like that breakdown, Mike and I like the idea of entrepreneurial poverty. And also you’ve talked about it in a few of your books. I used to be initially launched to you Mike by your ebook Revenue First, which is admittedly huge amongst plenty of operators within the trip rental brief time period rental house right here. You hear lots of people speaking about it. So, at this time we’re really speaking a few completely different ebook, which known as and if you happen to guys are watching this on YouTube, it’s known as Get Totally different, one other nice ebook by Mike. However earlier than we get into Get Totally different, Mike, if you happen to can simply give us just like the twenty second breakdown of Revenue First, for people who aren’t accustomed to that course of. I like that.

Mike Michalowicz:
Oh, for positive. Yeah, for positive. So, we’ve been instructed… Ever for the reason that invention of recent accounting, which is about 300 years outdated now that revenue is the underside line. It’s the phrase we use. It’s the yr finish, and the components gross sales minus expense equals revenue. However what I discovered is the overwhelming majority of small companies are by no means worthwhile. So, what confused me is maintain on, if that is the components and we begin a enterprise to be worthwhile, that’s like one of many fundamental causes how come nearly nobody’s worthwhile. And I used to be staring on the components at some point and it hit me. I used to be like, “Oh my God, this components is mistaken.” I imply, mathematically yeah, it really works. However behaviorally it’s mistaken. When one thing comes final, it’s human nature to categorize that as insignificant.
Like Tony, if you happen to love your loved ones, I strongly suspect you don’t say, “I like my household a lot. I’ve determined to start out placing them final.” And truly if you happen to had a well being scare, you wouldn’t be like, “Oh my God, I want rally to deal with my well being. I’m going to start out placing my well being final.” We might by no means do this as a result of final means it doesn’t matter. And in revenue we’re calling it the underside line, the ultimate take, the yr finish. It doesn’t matter. So, in Revenue First I train an actual easy system. We flip the components. It’s gross sales minus revenue equals bills.
What occurs in executions? Each time income new comes into our enterprise, we take a predetermined proportion of that cash as revenue, allocate it away, disguise it from our enterprise, then run the enterprise off the remainder. We’re now taking revenue first. It’s the pay your self first precept utilized to enterprise. And I’m very proud and glad to report that it has over 600,000 corporations now doing revenue first. They’re all no more, not simply, I ought to say constantly worthwhile, they’re really rising quicker than their contemporaries as a result of they’re constructing a more healthy enterprise.

Ashley Kehr:
That’s so superior. And congratulations on with the ability to share that with so many corporations and serving to them develop and scale that quick. That’s superior.

Mike Michalowicz:
Yeah, that’s the last word, like operating on the airport and it doesn’t occur typically, fairly the alternative, however often somebody’s like, “Oh my God, you’re that man.” And I’m like, “Which man are you desirous about?” And generally it’s a completely completely different man. Like, “Oh, I’m not that man.” However generally he’s like, “Oh, I learn your ebook.” Revenue First is often the one, that’s my hottest. After which folks share their tales that generally it simply takes me, I begin tearing up and takes me to this emotional state, simply pleasure and happiness for these folks for the transformation they’ve made in their very own lives.

Ashley Kehr:
That’s so cool to be on the opposite aspect of that. Like, sure, it’s superior for these folks that have that transformation. However whenever you understand that you simply had a small affect on simply opening up an thought to them after which they go and implement it-

Mike Michalowicz:
Yeah.

Ashley Kehr:
… Yeah, that’s superior.

Tony Robinson:
I used to be simply going to say, we’d should get you again on Mike for a second, go round the place we will simply form of give attention to the Revenue First aspect, as a result of I believe there’ll be plenty of worth for that as properly.

Mike Michalowicz:
Oh positive. Yeah, train the system. I’d like to.

Tony Robinson:
However at this time once more, we’re right here to speak about Get Totally different, which is definitely a ebook about advertising and why it’s necessary for small companies to try this. Now, earlier than we dive in only for like our Rookie listeners, you guys is perhaps considering advertising, why are we speaking about advertising on an actual property podcast? And Mike, you even have a extremely good story in right here about speaking to love considered one of your realtor pals and the way it may be utilized to this enterprise. However I wish to set the desk for the listeners that regardless that you’re an investor, you continue to should market. There may be nonetheless a advertising facet to your small business.
If you wish to discover a actually whole lot, you’re going to should discover a approach to promote it. In case you don’t wish to simply depend on Zillow. You may not should do some direct to vendor advertising. Say that you simply wish to increase cash for a giant deal you’re attempting to take down, you’re going to should marketplace for potential cash companions. There are such a lot of… So that you wish to promote a property and possibly it’s in a aggressive market and also you wish to stand out, how are you going to be inventive and the way you market that property?
So there are many ideas, I believe, that we’re going to speak about at this time that our rookie buyers can take away from and implement it to their enterprise. So, Mike, my first query to you is, one of many belongings you mentioned on this ebook was that individuals have a duty to market their product, to market their enterprise. I believe that was a extremely distinctive approach to phrase it. So break that down for our listeners what you meant by whenever you mentioned that there’s an obligation duty to market your product.

Mike Michalowicz:
I get a little bit cleaning soap boxy right here. So forgive me if I begin getting all like jacked up, however it could occur. I used to be at an occasion, I began scripting this ebook seven years in the past. It takes me a very long time to complete a ebook. I work on many in parallel. And it was about seven years in the past, I’m at an occasion. And I bear in mind asking folks, who right here on this room is best than the competitors. It was like HVAC firm or one thing and all of the arms went up. And at first I used to be like, “Can’t we actually? Is that doable?” Like, “We’re all higher than one another.” After which it grew to become obvious. Small enterprise is best than most small different companies and we’re higher than one another in several methods. One firm responds quicker. One is extra caring. One has far technical superiority and so they don’t all compete in the identical market.
So whenever you take a look at the markets they’re in, on this market, these companies typically are higher than any different. And the truth that they’re the learners, identical to the folks listening to your present proper now, these are the parents who’re really seeking to broaden and develop, inevitably higher. After which I mentioned, “Oh my gosh, if we’re higher within the competitors but nobody finds us, they discover the choice. That is the choice. That is us, however we’re invisible to them. The purchasers are getting a disservice or they’re experiencing one thing that’s inferior as a result of we’re superior.
And if our purchasers or our prospects are experiencing one thing inferior, that’s their downside, it’s our fault for not advertising. The opposite factor I heard too, and I’ve been surveying audiences consistently, I ask them, what proportion of your alternative comes by referrals by your community, stuff like that? And most of the people brag, myself included about that. Oh, nearly a 100%. Truly, I don’t even should market to your early level. I don’t even have to market as a result of companies flows to me. I really feel like king of the hill. And I’m like, “Oh, which means our purchasers, our community imagine in us a lot that they’re carrying the advertising burden on their shoulders. They imagine in us. Aren’t they simply affirming we’ve duty to get on the market?”
If the work you do in actual property is superior to the options on the market. Rattling it, you bought to greater. You bought to be found. It’s the one approach to be of service. That’s what impressed this ebook. And that’s why I began to analysis is, what provides the higher companies a chance to face out. And if we’re smaller, we will’t really compete in opposition to these mega companies on the market with a whole bunch of hundreds of thousands, generally billions of {dollars} backing them, that they’re simply throwing into promoting, however we will beat them by being completely different. And that’s what we have to exploit.

Ashley Kehr:
So let’s Form of tailor this to our rookie buyers right here. They’re getting began in actual property investing, what some recommendation you may give to them to get completely different as possibly they solely have a pair properties, they’re simply beginning out as a brand new enterprise.

Mike Michalowicz:
Yeah. So the very first thing to know is strictly who and what are you concentrating on? Once I was writing out the ebook I talked about what’s known as the who, what, and when. We’ve heard of who, what, and when, however the who, what, and when is who’re we serving? What are we driving or delivering to that market? And what’s the win? In any transaction there’s two sides. So how do each side come out forward? As a result of if you happen to simply win for your self, the compromise might be your popularity. And if they simply win, the compromise might be your continuance. So we now have to have that balanced win-win.

Tony Robinson:
And Mike, and simply to make clear, you’re speaking W-I-N not W-H-E-N. You’re speaking win as in like scoreboard win.

Mike Michalowicz:
That’s right. The who and I’m speaking when [inaudible 00:11:57]. That’s a great level. That’s like your Jersey accent. It’s like, “What’s he saying?” So we have to get a win and it’s bought to be a bilateral win. Like Tony, you bought to return out forward. Truly, you bought to return out forward and I bought to return forward of any transaction. And truthfully, even doing a podcast, it is a type of a transaction. Hopefully, you’re getting content material that serves your group. You get extra engagement. Hopefully, I’m getting publicity to a group that hasn’t skilled me. That’s my win. And anytime we now have a transaction, we bought to search for these wins. As soon as you realize the who, the avatar, what, your supply or the chance is, and the win, then we begin structuring what is going to entice that viewers. It all the time has to guide off with completely different, therefore the title Get Totally different within the ebook.
I had the great fortune of being related with some folks which might be actually clever round how our mind operates. So neuroscientists and folks that work in psychology and behavioralists and all this completely different folks, and I interviewed them and I discovered an attention-grabbing sample of what triggers recognition for one thing, for us to see or expertise one thing. In case you ever stroll down the road and also you do this double take, like, “What, what.” That’s our mind being triggered by one thing. And it’s completely different. In actual fact, our mind solely acknowledges three issues. All the things else will get ignored.
In actual fact, 99.999% of stimuli that comes into the human senses are ignored. This filtered out by this gatekeeper known as the reticular formation. Not attempting to get too technical right here, however the reticular formation is that this gatekeeper that claims, “Ignore that pen sitting in your desk proper now, since you’re presenting.” We really should ignore stimuli to concentrate, however the reticular formation opens up when three issues occur.
One, is when a risk presents itself. That’s the primary factor. So if I confirmed as much as your present and I had a gun on me, like, “Hey, we must always proceed on a little bit bit longer.” I’m waving round my gun at you. I assure I’d have your consideration, however the risk response hits the amygdala and the amygdala says, “Battle or flight.” So, the 2 of you punch me within the face, cut up in my face huge open I’m useless. It’s a combative state of affairs. So, most likely not a great transfer. The second strategy is alternative. Alternative opens up the reticular formation hits the prefrontal cortex of our mind. It lights up and says, “What is that this?”
So if I put like some huge cash down in entrance of you and say, “Hey, right here’s $500,000. Can we go for a little bit bit longer?” Likelihood is I’ve your consideration however the danger is huge on my behalf as a result of it’s possible you’ll say, “Thanks for the $500,000.” We’re achieved with the present anyway. So I put danger on the market. And by the best way, we’ve seen this in advertising. In unsolicited mail campaigns, you get a letter within the mail and it says open inside three days, that is FBI will hunt you down and also you open up and it’s just like the automobile salesman. It’s like scumbag, you tear it up. Different instances you get right into a letter after which there’s like a $5 invoice pasted on properly. It’s like, “That’s an actual $5 invoice. Give us a name.” You’re like, “My pocket is getting a name to go to Taco Bell. So I’m sorry.” And we take the cash.
The one third method, the one method, and the best method into the mind on the subject of advertising is completely different. The reticular formation opens up. It really illuminates a number of elements of our mind saying, “What is going on? Is that this a risk? Is that this a chance? Is that this one thing I’ve to qualify because it’s one thing I can ignore sooner or later, however I don’t know what it’s now.” So, the essence of whenever you determine that you simply’re higher than the competitors and also you’ve duty to extra market, the one approach to get prospects consideration is doing one thing completely different. Don’t do what everybody else is doing. That will get ignored. Is that this a blue pen? Do one thing completely different.

Ashley Kehr:
That I believe is such a… That is going to be so useful for people who find themselves utilizing unsolicited mail. As a result of proper now there are such a lot of, not even sellers, however householders simply getting tons of letters and postcards, textual content messages each single day. And the way do you form of filter your self out? And that’s the secret is you wish to be completely different so that you simply stand out from all 50 different postcards that they bought that week.

Mike Michalowicz:
You’re proper. And its wildly easy. And the first step is, take a look at what everybody else is doing. That’s the one factor to not do, significantly in your trade. So if everybody’s advertising the identical method. I bear in mind the primary time I bought a hey buddy e mail and I used to be like, “Oh my God, I’ve a buddy that I haven’t been in contact with apparently in years who, the one factor they name me is buddy. They don’t even name me by my first identify. They’re such an excellent buddy.” And I fell for it. I began studying by it. I’m like, “Oh that is smarmy advertising.” I deleted it. After which a day later or a minute later, the following hey buddy got here by, I deleted it. I’ve put these within the spam field ever since. And maybe I’ve acquired a whole bunch if not 1000’s. And so have you ever.
And that course of known as habituation. Habituation is when the reticular formation says, “Oh, I’ve seen this stimuli earlier than. It’s ignorable. Don’t even put into the mind, reject it.” And so these mailing items are assured to be rejected. However if you happen to do one thing completely different, it’ll get seen. And right here’s a method. You possibly can take a look at the medium mailing items otherwise you take a look at the strategy. Technique is strategy. So you possibly can change the medium. If everybody’s sending out mail, why not set billboards or no matter it says, “Properly, I’m seeking to purchase a home or one thing.”That might work, but when everybody’s doing billboards that wouldn’t work. Or you possibly can stick with the present medium, however change the strategy. So if everybody’s sending postcards, ship an image of your grandmother and say, ?My grandma all the time needed me to personal property on this space. I’m seeking to purchase. Would you have an interest?” Now, you’ve bought to be integral. Don’t freaking lie.

Ashley Kehr:
Proper, In case you don’t actually have a grandma and also you pull an image off the web, don’t do this.

Mike Michalowicz:
Yeah. So that you’re, “Oh, my God.” Please don’t do this. Customers are very sensible. Folks sniff that stuff out. The second there’s an integrity inconsistency, folks increase a pink flag. I noticed really occurred to me this morning. I used to be on the Zoom convention for a fast assembly. There was like 15 folks on it, however we weren’t stay but. So it was like all this folks photos. And I’m this one image. I’m like, “Wow, that girl is like actually younger to be on this name.” I’m really a little bit bit stunned. It’s not in the precise context. Prefer it’s a glamor shot or one thing.
She then activated her digital camera. And I used to be like, “Oh my God, you simply aged 30 years in a single second.” She went from this prepubescent to love a center aged girl in a single second. And I felt lied to. I used to be like, “Oh, okay. You wish to look a technique, however you’re actually one other.” And what we have to do is put out our genuine self. Put out your favourite image of who you might be at this time. With that grandma postcard, it higher be an actual story. And I’m not saying don’t lean into the distinctive idiosyncrasies or components of it. Play up grandma. Ship some pumpkin bread from grandma, do one thing like that, however do one thing that’s completely different and your assured to get consideration.

Ashley Kehr:
Mike, are you able to give us an actual life instance of, it doesn’t even should be actual property associated, however of the place any individual did and advertising completely different and bought nice outcomes.

Mike Michalowicz:
Properly, I’ll provide you with an actual property instance as a result of I featured it within the ebook. I can speak about gyms that do some cool stuff, however I’ve a buddy who’s an actual property agent, greater than an actual property agent. He owns an actual property company in Colorado. They’re fairly sizable. I believe they bought like 30 or 40 brokers. He’s a personal store. That’s fairly sizable. And he was studying the ebook with earlier than I launched it. He’s like, “Ah, that is actually attention-grabbing.” However he goes, “It’s simply ethereal stuff.” He goes that, “It doesn’t apply to me. Our trade’s established.” And right here’s a golden lesson. The extra established in trade, the extra frequent the advertising strategy, the better it’s to face out. The extra boring in trade, the extra radical the chance to distinguish.
One instance, I was within the laptop or know-how trade and I used to be slugging it out with all my competitors. And at some point this firm known as Geek squad is available in. All they did was they wore flood pants, slender tie, tape on glasses. And these guys grew to become heroes of the pc area. Subsequently, they’re a $1 billion valuation at this time after their acquisition from Greatest Purchase. You are able to do that. In the true property trade. So this man, Greg, my buddy is like, “It doesn’t apply to me.” I mentioned, “Properly, inform me, how do folks market?” He goes, “It’s all the identical.” The second I hear all the identical. I begin salivating like that’s not alternative to distinguish. He goes, everybody places up that silly sandwich signal or if it’s a fancier home, you set up that little submit, you buried in there and it hangs there.
You run your listings and your make certain it’s on Zillow listed correctly. And you set your charming fastened me up home and all these things. And I’m like, “Okay, that’s all of the stand protocol. Let’s simply begin with essentially the most fundamental factor for the drive by viewers, the folks which might be trying on the indicators. What if we set a special signal?” He’s like, “Properly you possibly can’t.” In fact, you possibly can. What we did is we bought indicators with windmills on it. These are belongings you put in gardens sometimes. And all we did was put an indication with the identical placard on it, saying home on the market, below contract, all that stuff. However there’s now a windmill on prime.
And it began to get seen, as a result of bear in mind from the buyer, you’re driving down the highway, one other signal, one other signal, they’re all the identical, possibly a special shade, however they’re mainly the identical. So we don’t discover. However the second there was a spinning factor, we did the double take. And if you will get the client to do the double take, it means the reticular formation’s opened up, the mind lightens up. It’s now questioning what it’s. Now, completely different alone will get consideration. It doesn’t imply it will get the precise consideration. So you must do the opposite components of attracting folks and directing them to do one thing. However stage one is due completely different.

Tony Robinson:
Mike, you’ve form of alluded this already, however why can’t I simply construct a greater widget? Why isn’t simply being good or being one of the best in your subject sufficient?

Mike Michalowicz:
So, being one of the best in your subject will not be essentially noticeable. Like, say you and I, Tony have competing companies. And I’m like, “What we’re going to do right here is we’re going to boost the telephone in two rings.” Each single time you go to your workforce and also you’re like, “What we’re going to do right here is reply our telephone in a single ring and beat that Michalowicz man.” You might be unequivocally higher. Truly, you’re a 100% higher. You’re answering the telephone quicker, however does the shopper discover? And the reply might be not, most likely not. Higher doesn’t essentially imply noticeable. And we will argue for all the day of how your small business is best than your entire opponents, however we will additionally go do actual opponents and level out how they’re higher.
Once I ask folks in audiences, are you higher? Everybody raises their hand and it’s true, however they’re higher at sure components, however most of it’s invisible to the client. It’s after we do one thing that’s out of the atypical, that they pay extraordinary consideration. Again to Geek Squad, I’d really argue in nearly each side my firm was higher, extra certifications, extra technical abilities, quicker response, we cared extra. I the proprietor was built-in within the enterprise. I used to be doing a number of the work myself and right here guys in costume. However to the client, it was extraordinary. I imply, who doesn’t wish to geek fixing their laptop? I imply, I do, I do and it was extraordinary.
They made it right into a considerably humorous expertise. As soon as they discovered that the shoppers resonating with it, they amplified it. They used to experience bicycles to their purchasers. They began out Minnesota. They expanded nationally. They went into these Volkswagen bugs that seemed on the Keystone cops. So when you discover a crevice of various and also you see folks noticing, amplify that. It doesn’t essentially imply you might be higher than the competitors within the generic classes. You’re simply doing one thing so sudden and distinctive that individuals simply have to concentrate.
One final thing, I’m not saying you must be outrageous. I’m not saying you must be a weirdo or the humorous man. Like, you must be the true property agent that attire in a gorilla swimsuit and dances round, that’s completely different, nevertheless it doesn’t imply it’s going to work. Totally different all the time will get consideration. Gorilla swimsuit actual property particular person will get consideration. Stage two is that it’s bought to be enticing. The viewers has to say, “Oh, that’s for me.” And the geeks, it was for the folks that wanted our computer systems repaired. We needed to discover, for everybody listening to the present, what’s your completely different, however is it compelling to the viewers? Is that one thing to say, “Oh, that’s for me.”

Tony Robinson:
So Mike, can we dive into that a little bit bit? As a result of I believe that’s an necessary second piece there of constructing it one thing that may enchantment to the individual that you’re reaching out to. We’re on the earth of actual property investing and say that I’m a brand new investor and I’ve this property that I wish to purchase, however I don’t have the cash to do it, and I have to exit and discover, I have to market myself to have the ability to discover somebody to assist me purchase this property. How do I’m going about entering into the psyche of that potential companion to even perceive what sort of advertising technique may resonate with them?

Mike Michalowicz:
Yeah. So we first should determine who they doubtless are. That’s the avatar. So when the who, what, and when was structured, they’re the who. We wish to increase cash and what’s the win for them, the win for us. So we now have to determine that. Then we goal them and we do testing. So get distinction about advertising experiments. I’m a little bit bit in opposition to advertising plans in that advertising plans are nice, however a plan means dedication. I plan to tour all 50 states. That’s a dedication. However earlier than we go a few advertising plan, we have to know, are we advertising in a method that’s going to be efficient? So, we wish to begin off with experiments and inherent to experiments is a trial and error. Some issues will fail. So as soon as we determine who we’re concentrating on, these buyers, let’s strive reaching out to them in several methods.
Now, apparently, I’ve raised cash for considered one of my companies previously. And I used to be in search of angel rounds. These are small buyers, possibly a 100,000 to possibly 250 is what the angel funding can be. So it’s not main tranches of cash, however for me, that’s a big sum of money. In case you get two or three folks, now you bought possibly even one million greenback increase. So I reached out and what I did was I recognized about 5 good angel buyers. Most individuals attain out, they do a blanket factor. They mainly do this postcard mailing, just a bit extra skilled spin as a result of it’s in an envelope that seals, nevertheless it’s mainly the identical.
I checked out what each different entrepreneurs to lift capital. I mentioned, “Okay, that’s what’s not, I’m not going to do.” Now, I used on this case the identical medium. I despatched out the skilled letter, however I did a special methodology. The opening to my letter mentioned, “I’m seeking to increase cash, however earlier than I even inform you in regards to the enterprise, I wish to inform you about my values.” Rule primary, no (beep) allowed. My actual phrases. I mentioned no (beep) allowed. And I mentioned, “I’ll by no means do enterprise with somebody that’s a (beep) and I’ll by no means be a (beep) in the direction of somebody. I believe all people are equal and all of us deserve respect of one another.” The second line mentioned positivity or loss of life. And I put out my 4 main values.

Ashley Kehr:
And also you made these values stand out too.

Mike Michalowicz:
Yeah, yeah and so they’re true.

Ashley Kehr:
It wasn’t like, I simply needed somebody to work with me that might be respectful and never be respectful to them. You used phrases to make it stand out.

Mike Michalowicz:
Yeah. And there are phrases which might be true to me. In case you meet me, like the way you’re seeing me now is identical Mike if we have been having a pair beers collectively. If we had 5 or 6 beers, I’m a little bit extra slurry however once more when, win-win, nevertheless it’s the identical me. And I believe I don’t wish to be the Zoom character that you simply see me once I’m 15 and you then flip it on and also you get this man and also you’re like, “Oh my God, what occurred?” So I do that constantly. That’s a serious tractor issue. The the way you market should be true to who you might be. That’s why in one other saying you possibly can’t see it behind me absolutely, however says, “Be you all you all the time, truthful all through.” What I bought again from the primary investor was at some point letter.
I bought an authorized letter again and I opened it. And in pink marker, no (beep) allowed was circled like 10 instances. And I used to be like, “Oh my God, what did I simply do?” And there was a sticky be aware hooked up to, it mentioned, “I don’t like (beep) both.” And beneath that was 100 thousand {dollars} test. His identify was Howard Hirsch, better of my firm. First man in, extraordinary investor and extraordinary worth alignment. He’s been a lot greater than cash to our group. He’s been strategic relationships and so forth. It helps us develop terribly.

Tony Robinson:
Can we… We bought to pause on that as a result of I believe that’s like an extremely necessary lesson for folks to know. So, first let me recap what you mentioned. You mentioned, “Be genuine to your self.” Be your genuine self and perceive what your values are and who you wish to work with. I believe for lots of people who’re in our viewers, people who find themselves at the start of their actual property investing journey, they really feel nearly this imposter syndrome as a result of they haven’t achieved the identical accolades as a number of the folks that they see on the podcast or folks whose books they learn and so they really feel like they should form of puff up who they’re or what they’ve accomplished-

Mike Michalowicz:
Oh, I hate that.

Tony Robinson:
… however what you did-

Mike Michalowicz:
Once more.

Tony Robinson:
… however what you probably did, Mike was the alternative of that’s that you simply leaned into no matter expertise you had. You leaned into your values as an individual, and also you amplified that and it allowed you to draw folks that have been extra intently aligned with what you actually need. And that’s the tremendous necessary lesson, as a result of for the rookies say that you simply do faux to be, you’re going to draw the mistaken kind of individuals. In case you’re not being who you might be, the mistaken persons are going to gravitate in the direction of you. So whenever you be your self, you’re capable of finding the precise particular person.

Mike Michalowicz:
And the rationale that I hate that’s I get why folks do this. And I’ve achieved that too, this pretend till you make it and stuff. However there’s this itchiness that was dripping in dimension like, “Oh, that’s probably not who I’m.” And to your level, is monitoring the mistaken folks. I assumed I had a pound on my chest. And I’ve seen these actual property guys. You bought to put on the slick swimsuit and be sure you’re munching a cigar and whenever you’re going out to lunch, you’re flashing the hundred {dollars} payments and your shiny playing cards. And what if you happen to went within the true self and also you merely mentioned, “I’m an actual property rookie. I’m the true property virgin, or one thing like I’ve no clue what I’m doing.” That’s the benefit.
With no clue means this deal means every thing to me. I’m not only a 100% in, my complete life is in, like, I’ve to make this profitable. I might be there each second of the day. That advertising is a lot extra highly effective than one other slick marketing campaign as a result of it’s true. Some buyers say “No, I don’t need somebody by no means achieved this earlier than, I’m out.” However some persons are going to say, “That’s precisely who I’ve been in search of.” I need somebody’s hungry, thirsty, ravenous for this. That is somebody I can coach and assist in the method and never simply spend money on. And also you’ll monitor the precise folks by being true.

Ashley Kehr:
That’s such an excellent level. And Tony and I have been speaking about this earlier at this time, is {that a} rookie investor, a brand new investor goes to be so motivational and inspirational. I believe you simply tagged on one other facet to it that they might even work harder-

Mike Michalowicz:
True.

Ashley Kehr:
… than any skilled investor too.

Tony Robinson:
So one of many different belongings you talked about within the ebook and this sort of aligns what we’ve been speaking about, nevertheless it’s the dad framework. Properly, I assumed it was a humorous form of approach to phrase that. So what precisely does that imply if we will break that down for the listeners?

Mike Michalowicz:
Yeah. So dad is the guidelines, if you’ll, for advertising that works. We already touched on components. The differentiate is the primary D. Any advertising you do if it isn’t completely different than the usual noise, it’s really invisible to a client. In case you don’t differentiate, you don’t get seen. So you must test that field off. However right here’s the factor, is completely different lasts for about one tenth of a second. And this isn’t only a random quantity. That is precise analysis identifies that after we discover one thing completely different, our reticular formation opens up and it hits elements of our mind. After which inside one tenth of a second, we’re putting judgment.
In case you ever been outdoors and also you see one thing form of squiggle and also you bounce again, that’s the 1/10 of a second response of the amygdala saying, “I don’t know what’s occurring, one thing completely different’s occurring.” And it’s lighting up our mind to guage, is that this a snake? Can somebody flip the hose on? What’s occurring? So be completely different. Get 1/10 of a second consideration. You instantly have to transition into the enticing issue. Is that this messaging for me? It’s bought to be so clear that’s for the viewers that you simply’re concentrating on. So communicate of their language, use the weather that they acknowledge and clear up an issue they’ve, or relieve a ache, or simply invoke curiosity or entertain.
However there needs to be a justified motive to proceed on. And it’s really often a mix. In case you can educate or no matter it’s like the place you educate and entertain on the identical time, that turns into extra highly effective. In case you can educate and entertain and clear up an issue unexpectedly, now it turns into extra highly effective. So mix these components collectively, however the attractor issue, that’s the A in dad solely lasts for 1/10 of second increments. And it’s occurring proper now, as we’re speaking for the parents listening in, they’re saying of their head, subconsciously doubtless, am I getting worth? Am I scripting this down, taking notes? Is that this transformative? Or is it higher simply to test e mail? Properly, I’ll get extra worth out checking my e mail.
In order that battle is going on in everybody’s thoughts, together with the listeners proper now, figuring out there’s a motive this podcast isn’t like a 48 hour simply onslaught. Like, it doesn’t run for 48 hours straight, as a result of at sure level you possibly can’t retain that attractor issue. So be enticing, but additionally understand that point is ticking away. Then you will need to go to the direct. The direct is the place you give your prospect a particular and specific course to take. With this key caveat, it should be cheap. Like, say Tony you’re in search of a automobile and also you see a balloon factor out within the parking zone, which if you happen to acknowledge that… You’ve seen these, proper?

Ashley Kehr:
Mm-hmm (affirmative). Yeah.

Tony Robinson:
Yeah.

Mike Michalowicz:
So these issues, once they first got here out, chances are high really Tony, whenever you first noticed them, you’re like, “Oh my God, that’s so completely different.” The primary time. They’re so ubiquitous now as a result of it labored, it’s turn into extra noise. And we don’t really see, we blow by and go, “Oh, there’s balloon boy once more.” And we frequently affiliate saying, “Oh cheapo sale factor, used automobiles or one thing like that.” So balloon boy has deteriorated. That’s the issue with completely different. Totally different works till everybody replicates it. After which we now have to seek out the brand new completely different, it expires. However say balloon boy brings in, that was the differentiate. You have been attracted. You noticed that you simply needed to purchase a automobile. And that is an alignment with what you’re trying. So it solves a ache you’ve, okay and purchase a automobile. I’m the automobile gross sales man.
I’m like, “Hey Tony, I heard your in search of a automobile. Let’s discover your dream card, give 100 thousand {dollars} deposit. We’ll discover it.” And also you’d be like F No pal as a result of it’s too huge of an ask. Once I direct you to do one thing, it must be cheap. However the mistaken strategy to is to have such a low direct, there’s no motion required. It’d be like, you come into the lot. And also you’re like, “Hey, I’m in search of a automobile.” I’m like, “Oh nice, we now have automobiles. I’ll goodbye.” And stroll away. You’re like, “What do I do?” “Simply wander round and also you’ll see us on web sites.” I hate going to web sites the place the decision to motion is be taught extra. The entire motive I went to the freaking web site was to be taught extra. Don’t make me do this. The proper motion is the cheap motion.
So that you come into my automobile so much. And Tony, I believe the precise factor can be for me to say, “Hey, you’re in search of your dream automobile. Would you be prepared to present me your cell quantity? I’ll take photos of our stock right here at this lot and different tons, I’ll textual content it to you so we will hone in in your dream automobile.” That’s a transaction. You give me contact data, your cell, I provide you with data on your resolution. After which my job is to matriculate that to the transaction. After which on the finish you’ve theoretically your dream automobile. I theoretically have my dream fee. And that’s what we’re attempting to realize collectively. It needs to be cheap.
The final factor or the very last thing I wish to say about dad, is you must test off all three. I’ve seen companies do some actually completely different and enticing, after which it goes to nowhere. There’s no direct. I’ve seen folks say bye now, however there’s no compelling motive to do it. I’ve seen a lot advertising, most advertising that isn’t completely different within the first place. It speaks to the viewers. It tells them what to do, however nobody notices as a result of it’s unnoticeable.

Ashley Kehr:
Mike, I wish to pivot right here. And we’ve talked about huge enterprise, particularly balloon boy in entrance of a enterprise and your buddy, the true property agent, his enterprise and the completely different advertising. What in case you are one particular person, you’re employed in a closet as per se me and also you don’t have a storefront and also you don’t have an enormous advertising finances and also you rely totally on social media to place your self out as a model. So, actual property buyers whether or not elevating cash or getting on patrons listing or promoting your flips, issues like that. What are some ways in which simply that one particular person can market themselves by social media or possibly different avenues that you realize?

Mike Michalowicz:
Yeah. So what we search for first is what’s known as congregation factors. The congregation level is the place are your very best prospects, that avatar we talked about congregating? So in the event that they’re congregating on social media, we bought to refine down. Like, is there a Fb group they’re on? Or is it extra of a LinkedIn client? The place are they? And possibly they’re bodily assembling. So possibly you bought to get out of that closet and drive right down to the native membership or one thing like that. So discover the congregation level. And the easiest way and the best approach to discover that’s take a look at your present greatest prospects and say, “Hey, the place do you go to satisfy folks such as you?”
I’m like, “Oh, everybody goes on Fb or everybody listens to this podcast. Or there’s this membership everybody hangs out at.” That’s your congregation level. Then we merely want to seem. And showing merely means simply being current however in a noticeable method. I’ll provide you with an instance of this. My first firm was doing computer systems. I used to be struggling. Geek Squad got here in, kicked my ass. I used to be like, “Oh my God, I’m achieved.” However then I seen my greatest buyer was a hedge fund. I knew nothing about hedge funds, however they have been my greatest buyer. I went out and met with them and I mentioned, “Hey, you’re my greatest buyer truthfully, I like serving you. I wish to serve you higher. What am I doing proper?” And it is a key query on the subject of advertising and it is a Jedi thoughts trick, like that is stage two stuff.
Once I mentioned, “What am I doing proper?” He mentioned, “The response time is admittedly good. The final laptop firm didn’t reply as rapidly. You reply rapidly.” No matter you’re doing proper will not be what you’re doing proper. It’s what the client judges you on. And that’s the factor you really should do higher and market on. When he says you reply rapidly. I mentioned, “Oh, okay. I higher begin responding quicker as a result of if I’m ever gradual, he’s going to be pissed as a result of he’s telling me.” If I reply quicker, I do know he’ll discover. We do 1000’s of issues. The shopper can solely see about 0.1% of the stuff we do.
Discover out, ask them what it’s by saying what you’re doing proper. I didn’t begin advertising quickest response instances. I wore a lightning bolt on my jacket and I went to the congregation level, which was hedge funds have a convention out in lengthy seashore, California. I flew on the market. I threw my little lightning bolt on and began strolling round. And to me I’d say, “Oh, who’re you? Do you personal a hedge fund?” I’m like, “No, I’m a pc man. And so they’re like, “Oh, you’re the one laptop man right here.” Which is completely different alone. Simply being the man there when nobody else is showing.
Now, everybody needs to be your buddy. Like, “Oh you’re the pc man, that’s wonderful.” They go, “What’s the lightning bolt?” Oh I mentioned, “Oh, we satisfaction ourselves on response instances.” Like, “You’re quick responders.” I’m like, “Yeah.” I’ll say Appaloosa, that was the corporate. I requested Appaloosa about response time. And we picked up 75 hedge funds over a two yr interval by going to the congregation factors. That firm was then bought by a personal fairness. It lives on at this time and really has being resold once more. So the lesson is, even if you happen to’re in a closet, there’s nonetheless congregation factors. And possibly it’s on social media, you’re carrying your lightning bolt or possibly going out to a bodily assembly, however first ask your greatest buyer what you’re doing, proper, the place they’re congregating and go there after which reveal that proper factor by your advertising.

Tony Robinson:
One observe up query to that-

Mike Michalowicz:
Was that gold?

Tony Robinson:
… No, that was nice [crosstalk 00:38:11]. That was nice. And like so many-

Mike Michalowicz:
That was superior.

Tony Robinson:
… so many good questions that come out of that however I believe you have been capable of get that perception in regards to the response instances being tremendous necessary. And also you’re capable of form of dive first and simply run with that, however say that I’m like a solopreneur. I’m this one man or one girl present, how do I-

Ashley Kehr:
Tony, I’ve to interrupt you. And I’m so sorry to do that.

Tony Robinson:
First time ever on this present, an interruption.

Ashley Kehr:
I’ve to say one thing to Mike actual fast earlier than we transfer on about that’s that as you have been simply speaking about that as like getting out of the closet and going and discovering like routinely, I began desirous about the place are folks that hate their jobs and wish to get began in actual property investing? What convention am I going to go to and speak to these folks and get them listening to the present and get them began in actual property investing.

Tony Robinson:
I find it irresistible. Did you determine the convention?

Ashley Kehr:
Yeah, I assumed that was actually nice. My buddy that’s in building, that’s going to be partnering with me, he hates his job [inaudible 00:39:07] building and that they are often undertaking managers and do rehabs. However that was my first thought.

Mike Michalowicz:
Truly, simply to construct on that. That approach works. I met with the, I can’t bear in mind his identify now, however the founding father of Boston Hen, which grew to become Boston Market, in the end. I don’t know if this nonetheless exists, however fairly huge franchise. When he began his first entrepreneur endeavor as a teen, he was promoting again then they known as then they known as ambulators, however push child carts or what do they name know? Carriage, child carriage. He bought ambulators-

Ashley Kehr:
A stroller.

Mike Michalowicz:
… Certain, stroller. My children are so outdated. I can’t do not forget that.

Ashley Kehr:
You simply aged your self proper there.

Mike Michalowicz:
I Completely aged myself. I’m like what, what can we name them?

Tony Robinson:
Yeah, I used to be Googling ambulator. What’s ambulator?

Mike Michalowicz:
All these items known as automobiles? What do automobiles do? We used to horse and ponderous. So, he labored in New York Metropolis and he mentioned what he’d do is most of his competitors was going door by door knocking saying, “Hey, do you’ve a baby you’ll be having within the subsequent 9 months? We promote strollers. What he did is he went to the bottom, as a result of that is again when diapers have been clothed and also you’ll dry them on the strains outdoors and he’d depend doorways up or flooring up and doorways to the aspect and he’d go proper to the doorways.
He’s capable of navigate a constructing in like 1/5 or 1/10 on the time and he’s hitting the prospects. I like what you have been saying. Truly you’re like, the place are the individuals who wish to turn into actual property buyers? Don’t go into the true property investor enterprise. That could be too late for that convention. What convention comes previous to that? The place persons are getting disenchanted with what they’re doing, that could possibly be the precise spot to go. So I used to be simply jacked about your technique. You gave me gold. You gave me the win-win.

Tony Robinson:
Yeah, it’s a win-win. There you go.

Ashley Kehr:
[crosstalk 00:40:49] that transaction.

Tony Robinson:
Mike, I wish to provide you with some credit as a result of I’ve learn different advertising books. You consider Purple Cow up by Seth Godin, which form of has the same premise. However I bear in mind I walked away studying that ebook feeling like, “Okay, that’s a extremely good thought.” However the software wasn’t there. He didn’t actually provide the steps it’s essential implement this in actual life. So, you’re left form of questioning what to do subsequent. Whereas your ebook, not solely do you give a extremely strong, thorough rationalization of the thought, however there are tactical step-by-step issues to do on the finish of just about each chapter to work this into your small business. So, with that in thoughts, Mike, and I assume we will form of wrap up after this, however the place do you see essentially the most entrepreneurs fail attempting to implement the motion steps for methods that you’ve got within this ebook?

Mike Michalowicz:
That’s an excellent query. And thanks for pointing it out the significance of taking motion. And Tony that’s the place most individuals fail. They are saying, “Oh, that is nice, however I’m actually snug simply sitting on social media. And regardless that social media will not be working for me, I’m simply going to remain there as a result of everybody else is operating Fb adverts possibly I’ll put some cash in that. And when it doesn’t work, I get actually annoyed and get offended, however I’m going to return to doing Fb adverts anyway.” It’s a human tendency is that we’re very snug doing what we’ve achieved earlier than, even when it doesn’t work.
So, the failure level is that, is that individuals possibly assume one thing completely different after which they speak to themselves out and so they say, “Properly, that’s not going to work.” How I envision is there’s a satan on our shoulder and there’s an angel. And the Angel’s saying, “You’re higher within the competitors, that individuals want you, get on the market and get seen.” The satan is like, “It’s embarrassing if you happen to market ineffectively. You’ll be shunned from the group. Don’t do it. Simply do what you’ve all the time achieved regardless that it’s sucks, since you suck.” And so like this devil-angel occurring and so they’re combating. We have now to defeat that satan.
And to beat it, we merely have to appreciate a, what you do is extra necessary to get discover than to be invisible. The world is ravenous for you. Secondly, begin off actually, actually small. Purchase that lightning bolt lapel and put in your pin in your shoulder. I felt so bizarre carrying that factor and strolling round and a few folks seen it and I used to be like, I’m already going to do like make enjoyable of me and assume I’m a pretending to be a superhero. Like, “Oh my God.” And so they’re like, “Oh that’s attention-grabbing. What’s that?” And one particular person’s like, oh, that’s form of bizarre. By no means seen that earlier than.” However it invoked dialog.
And that began constructing my confidence. So with an experiment at this time. Ship out the grandma postcard at this time. In case you’re not going to try this, simply begin carrying one thing on the lapel of your jacket or outfit that’s all the time seen or decide to a shade and simply go neon inexperienced on every thing you do going ahead. I’m not saying that’s going to work and get outcomes, nevertheless it’s going to start out engaged on our thoughts and understand that individuals will begin noticing and talking about it. And the folks that don’t care gained’t discover. They’ll simply be, “Ah, no matter.” They’ll disqualifies. I’ve by no means seen somebody do completely different advertising and the implications been like somebody killed them or one thing. What we concern’s going to occur by no means occurs. And if we don’t do it, our grace concern will occur in our enterprise will simply be stagnant.

Ashley Kehr:
Mike, thanks a lot for all of this nice data. I really feel such as you’ve jampacked a lot worth into such a brief period of time and a few nice takeaways. And likewise you’re actually humorous too, I believe.

Mike Michalowicz:
I hope you’ve 3D glasses on, as a result of take a look at that. Have a look at that. Wow, that’s fairly wild. Thanks. I had plenty of enjoyable with you Ashley and Tony-

Ashley Kehr:
Sure.

Mike Michalowicz:
… this has been a blast. Thanks for having me.

Ashley Kehr:
Yeah. Are you able to inform everybody the place they’ll discover out some extra details about you and attain out to you?

Mike Michalowicz:
Yeah. So let’s do it. The place to go, I’ll provide you with two. I don’t know why I’m waving my [crosstalk 00:44:28]. It’s my letter opener.

Ashley Kehr:
Wait, we began out the present with you speaking about holding us at gunpoint and now there’s a knifepoint.

Mike Michalowicz:
That is risk approach. Now, right here’s what you are able to do. You possibly can go to mikemichalowicz.com, however right here’s why I wouldn’t go there since you gained’t be capable of spell that final identify. There’s an alternate. It’s Mike Bike. So, that’s my nickname from highschool. Not as a result of I’ve ever pushed to motorbike, simply because it rhymed Mike Bike. In case you go to mikemotorbike.com, you’ll get entry to all my books. You may get free chapter downloads. The chapters that can really allow you to. So that you don’t even have to purchase the books. I hope you do, however you’ll should. And there’s different sources. I used to jot down for the Wall Road Journal, that’s there too. And there’s a pair issues that can simply hopefully entertain you. I prefer to joke round. So I believe you’ve some enjoyable visiting mikemotorbike.com.

Ashley Kehr:
Properly, thanks a lot, Mike, for becoming a member of us. This has been actually nice. I’m Ashley @welcomerentals and he’s Tony @tonyjrobinson on Instagram and we’ll see you guys subsequent time.