{"id":3685,"date":"2022-09-08T17:38:25","date_gmt":"2022-09-08T17:38:25","guid":{"rendered":"https:\/\/imsfund.com\/?p=3685"},"modified":"2022-09-08T17:38:25","modified_gmt":"2022-09-08T17:38:25","slug":"make-millions-in-real-estate-by-gamifying-your-day-to-day","status":"publish","type":"post","link":"https:\/\/imsfund.com\/index.php\/2022\/09\/08\/make-millions-in-real-estate-by-gamifying-your-day-to-day\/","title":{"rendered":"Make Millions in Real Estate by Gamifying Your Day-To-Day"},"content":{"rendered":"


\n<\/p>\n

Nobody likes <\/strong>cold calling<\/strong><\/a>.<\/strong> Even just the thought of cold calling is enough to make seasoned real estate investors start to sweat. The waiting, debating, and constant rejection can get to anyone<\/strong>. So why not take the stress out of a tense situation? Why not make cold calling a game<\/strong>? Luke Rotvold<\/strong> decided to do just this. As a new wholesaler, he was used to spending hours on the phone every day. He got so bored that he started playing video games while <\/strong>negotiating with sellers<\/strong><\/a>. Surprisingly, it didn\u2019t distract him\u2014it made finding deals far easier.<\/p>\n

Luke severely leveled up his cold calling skills during those eight-hour long Madden marathons<\/strong>, and eventually started making enough money to build his own team. But Luke didn\u2019t want to start something that felt like a drag to the workers, employers, and everyone else in between. Instead, Luke built a lifestyle-first business<\/strong>, where everyone wins<\/strong> (and loses) together, and coming to work feels like an escape, not a prison sentence.<\/p>\n

The results speak for themselves as Luke and his team have been able to crush massive wholesaling, flipping, and investing goals<\/strong>. Luke has made hundreds of thousands on flips<\/strong>, tens of thousands cold calling<\/strong>, and now watches as his cascading cash flow<\/strong><\/a> rolls in from his buy and hold investments. He breaks down his four tips to gamify your real estate business <\/strong>so you, and your team, can build wealth together.<\/p>\n

\n

David:
This is the BiggerPockets podcast show 659.<\/p>\n

Luke:
Something that\u2019s big is we give our entire team so much freedom in the sense that if they ever need anything, if they ever want to take a trip, they can ask us, but they really don\u2019t even need to. It\u2019s done. It\u2019s done. So, there\u2019ll be times when anyone on our team, they can say, \u201cThis is coming up. This is going to do this.\u201d Perfect. You\u2019re gone. Have fun, enjoy it and enjoy your time with the family. And so, we\u2019ve made sure that everyone knows how important it is to us, that they get their time with their family.<\/p>\n

David:
What\u2019s going on, everyone? This is David Greene, your host of the BiggerPockets Real Estate Podcast, the best real estate podcast in the world by far. I\u2019m here joined today by my co-host Rob Abasolo, wearing a John Mayer T-shirt, the first time I\u2019ve seen him in a printed tee or anything that isn\u2019t just a plain black tee that he got out of a plastic package at Costco. Rob, tell me, what do I owe the honor of this privilege to?<\/p>\n

Rob:
Okay, I\u2019ll give you the truth here. All right. So, look, I used to be a big graphic tee guy, and then people on the channel would be like, \u201cWhere\u2019d you get your shirts?\u201d And then, I watched this video that was like, why I wore the same shirt for the last two years. And I was like, \u201cMan, that\u2019s a great concept. I\u2019m going to wear a black pocket tee every single day.\u201d And then, I moved to Houston and everything is hot. And literally, all my black pocket tees are drenched in the laundry basket right now because I\u2019ve been filming content outside.<\/p>\n

Rob:
So, part of it is it\u2019s laundry day, but also, I think it\u2019s time to bring back the pocket tees. I think I\u2019m going to start reintroducing that in the wild here.<\/p>\n

David:
So, you\u2019re doing that thing where you try really hard to look like you\u2019re not trying hard by wearing black pocket tees.<\/p>\n

Rob:
That\u2019s right. It was a game for a long time because I was really trying to find the best black pocket tee. So, it wasn\u2019t from Costco. I went to some pretty niche online stores to find them and I think I did. And also, I had a kid and I\u2019ll tell you what, black pocket tee, while having a kid who\u2019s always spitting up was just a really bad idea. So, I lost a lot of good shirts due to my son, Rook, but that\u2019s all right. I\u2019m rebuilding still.<\/p>\n

David:
Well, on the topic of games, that\u2019s a great segue into today\u2019s show. Rob and I are going to be interviewing Luke Rotvold, a wholesaler, cold caller, and real estate investor, who is crushing it in the Phoenix area. Luke\u2019s got a great system of getting properties under contract, wholesaling or flipping them, and then taking those profits and then putting them into multi-family real estate, where he is building up his cash flow, a cool little system of moving money along a conveyor belt, amplifying it every step.<\/p>\n

David:
And part of the success to Luke\u2019s system is turning boring, menial, and routine tasks into something fun by using games. He\u2019s known online for getting people under contract and speaking with leads online in his wholesaling business while playing Madden. And he\u2019s taken those principles and applied them to his company where he keeps his team members engaged and motivated by turning things into a game.<\/p>\n

David:
I thought this was fascinating, really smart, and a way to try to take work and make it fun. Rob, what were some of your favorite parts of today\u2019s show?<\/p>\n

Rob:
It\u2019s always interesting to find out people systems and his system here, the gamifying everything is really cool. And you could think, \u201cOh, well, that may not work for everybody.\u201d But when you actually look at his business, he told us he was doing 75 flips a year and about 110 deals a year in total. And I think that\u2019s really impressive. So, really fun to dive into the psychology of this and basically how to make every little aspect that could be looked at as a menial thing, fun and challenging in a good way.<\/p>\n

Rob:
So, I think we\u2019ll learn a lot about the way you can set a culture in your company too, and how to make that somewhat of its own game as well.<\/p>\n

David:
Absolutely. This is a really fun show. So, I would recommend everybody who\u2019s listening to this one to just share it with somebody else, because this is one of those things that makes people think, \u201cHey, real estate investing actually can be cool. It can be fun. It\u2019s not just a grind, and it\u2019s not just this crazy scatterbrain just run around and do a million things. There actually is some intentionality that you need to embrace to make some progress.\u201d And we talk a lot about progress in this show and how important that is to the human experience to stay motivated.<\/p>\n

David:
Before we bring in Luke, today\u2019s quick tip is, look for ways to gamify your own life. Are you trying to get in better shape? Are you trying to build your cash flow? Are you trying to build your net worth? What are your goals? Are you trying to build a team? Find these principles that would work for you that motivate you and apply them to business. I\u2019m a firm believer that business does not have to be different than your personal life.<\/p>\n

David:
What works for you in your personal life will usually work for you in business. So, look for a way to bring those two things together. And speaking about having fun, go to biggerpockets.com\/events and get your tickets to BPCON22. It\u2019s going to be in San Diego, one of the nicest areas that I\u2019ve ever been to, and it\u2019s going to be a blast. Rob\u2019s going to be there. And he might even be wearing one of his black pocket tees.<\/p>\n

Rob:
It\u2019s almost guaranteed. And I hear, David, you\u2019re going to be giving the keynote there. So, a real special treat for anyone that\u2019s joining. I think we\u2019re not sold out yet, but I think pretty soon, it\u2019ll be sold out. So, you\u2019ll definitely want to grab your tickets again. Again, that\u2019s biggerpockets.com\/events.<\/p>\n

David:
And you just got Rob scare in black pocket tee. All right. Without any more ado, let\u2019s bring in Luke. Luke Rotvold, welcome to the BiggerPockets podcast.<\/p>\n

Luke:
Thank you for having me. I\u2019m stoked to be here.<\/p>\n

David:
Yeah. We\u2019re excited to get to know you. So, tell me, what does your portfolio look like right now?<\/p>\n

Luke:
Oh, boy. Right now, we\u2019re pretty much going heavily into multi-family and Airbnb. So, I know a lot of people that do strictly just single-family and just because it\u2019s obviously easy and it\u2019s safe. If we go single-family, the only option that we will even think about with it is going to be an Airbnb and then everything else is multi-family. So, right now, we\u2019ve got a 10-unit being built in Sedona. That one\u2019s actually crazy. We\u2019re going to do 10 Airbnbs with that one.<\/p>\n

Luke:
So, that\u2019s going to be a pretty wild project, but we\u2019ve got, let\u2019s see, we\u2019re at 39 units. So, 39 doors right now, 10 being built in Sedona. And then, we\u2019ve got a 32-unit new build that\u2019s being built downtown Prescott, which is a couple of hours north of the Phoenix area as well.<\/p>\n

David:
Okay. And what about your business?<\/p>\n

Luke:
Business-wise, we\u2019re on pace this year to do 75 flips. So, 75 flips this year and we should do right around 110 deals is what we\u2019re on pace for this year.<\/p>\n

David:
Okay. That\u2019s pretty impressive. So, let\u2019s hear about how you got started. How did you get into your first deal? What brought you into real estate?<\/p>\n

Luke:
Yeah, so, really, I started cold calling. I joined a team. So, that\u2019s how some people have heard a little bit about my story is I started cold calling an hour, two hours a day. And then, obviously, it\u2019s one of those things where cold calling is monotonous. It gets old, it gets boring. So, I started implementing playing Madden while I started cold calling. When I did that, I started cold calling like five to six hours a day, which obviously, when the average person is maybe not even calling an hour or two per day, and then you start calling five to six.<\/p>\n

Luke:
Obviously, the amount of contacts that you\u2019re making, the ability to perfect your craft, the ability to get better at what you\u2019re doing is just, should blowing by people at that point. So, once that started, the deal started coming in pretty regularly and started just wholesaling, started on that team. The team that I was on broke apart. And so, then, I went and I started my company with my best friend, Jake Landis. And so, we\u2019ve got our team now.<\/p>\n

Luke:
Like I said, started with cold calling, started with wholesaling and we\u2019ve just taken that path at the, I\u2019d say that the average wholesaler takes in the sense that they would like to take where we went from wholesaling to flipping, to keeping properties with rentals into, we\u2019re at the point now where we\u2019re starting to do a lot more developing now. So, that\u2019s the path that we\u2019ve taken if you will.<\/p>\n

Rob:
So, when you were playing Madden and making these cold calls, do you ever have anyone that\u2019s sniffed you out on that? Were you ever like, \u201cDang it?\u201d They\u2019re like, \u201cOh, what?\u201d And you\u2019re like, \u201cNothing, nothing?\u201d<\/p>\n

Luke:
All the time. Oh, man. Unfortunately, that was the number one thing that I had to try to cut back on. So, this is the path that it went is like, okay, I first started just in arcade mode when I was hopping on Madden and I\u2019d be like, \u201cOkay, I\u2019ll try to just go ahead and see how it goes. And maybe I\u2019ll try playing while I\u2019m calling.\u201d But obviously, the number one most important thing for me every single time was the cold call because I\u2019m working. You know what I mean? That\u2019s why I\u2019m doing this is to try to get deals right now.<\/p>\n

Luke:
So, it started with that. And then, I was like, once I got comfortable, I was like, \u201cOkay, I\u2019m going to hop on and do Madden online right now. I\u2019m going to start playing online because it\u2019s more fun and it\u2019s more competitive.\u201d But then, the thing is you only got one pause, so you get one pause a game. So, you\u2019re like, \u201cOkay, (beep) I got to use this pause very sparingly.\u201d<\/p>\n

Luke:
So, whenever I\u2019d have a lead where I had to write all the information down, that was when I\u2019d use my pause. But there\u2019s times where you\u2019d start getting multiple, you get multiple leads in that calling session. So, yeah, you had to adapt and figure it out.<\/p>\n

Rob:
I\u2019m sure you had to take one for the team, take a few Ls in Madden to close a couple of deals.<\/p>\n

Luke:
Unfortunately. But it\u2019s like, at the time then, our average wholesale was probably 25K so it\u2019s like, yeah, okay, 25K, or do I want the extra win right now in Madden?<\/p>\n

Rob:
I think you made the right choice. I think the 25K probably pans out in the long run. You mentioned, you were taking five to six calls a day and I think that\u2019s really important. A lot of people-<\/p>\n

Luke:
Calling five to six hours.<\/p>\n

Rob:
Yeah. Sorry. Five to six hours. That\u2019s really important. I think a lot of people, they hear about wholesaling and they hear about the off-market deals and they\u2019ll only put in one or two hours and they don\u2019t get success and then they quit. But I remember I was talking to a buddy of mine who said that he didn\u2019t get any sales for his first two months or something like that. He didn\u2019t get any wholesale deals and he was working part-time. But then, he finally got his first one and started really data tracking how much time he really needed to put in.<\/p>\n

Rob:
And so, he realized he needed to put in an average of 80 phone calls or talk to 80 people before he could close a deal. And so, as soon as he did that, he mathed out, \u201cOkay, it takes me four hours a day to call 80 people and blah, blah, blah.\u201d And he mathematically figured out that for every eight hours, he would get a lead or something like that. So, I\u2019m curious, were you ever at that point where you were tracking exactly your conversions or anything?<\/p>\n

Luke:
Oh, 100%. Yeah. There\u2019s no doubt about it. That was actually to me when it started getting real where I was like, \u201cOkay, I got to stay on the phones. I have to.\u201d There\u2019s no question about it. Because I ended up breaking it down to how much I was making per hour while I was on the dialer. And that number when I found out that number, I was like, \u201cBro, this is insane.\u201d So, to me, I don\u2019t remember the exact number, but it was something along the lines of, I was making $560 per hour that I was on the dialer.<\/p>\n

Luke:
That\u2019s what it broke down to for how many leads I would get, how many hours I had to be on the phone, which turned into the lead, which turned into the deal. And obviously, that was the number for me was I was making $560 an hour for every single hour that I was actively on the dialer playing Madden.<\/p>\n

Rob:
Wow, $500 an hour. That\u2019s like, let\u2019s see, a full-time salary on that. I think comes out to $1.1 million or something like that. So, that\u2019s a pretty motivating number to chase.<\/p>\n

Luke:
Yes, exactly. So, that was when it really all switched for me.<\/p>\n

Rob:
So, what was the moment that you started closing enough deals to where I imagine at some point, you were playing Madden, you were closing and then you got so good at this that you\u2019re like, \u201cOkay, it\u2019s time to take this to the next level, \u201d and just hit Pause from the start. So, what was that transition like when things really started to heat up?<\/p>\n

Luke:
Yeah. I\u2019d say that it got to that point where it was like, \u201cOkay, now, once you start closing some wholesale deals, you start having some money.\u201d And so, obviously, the thing is that when most people are starting wholesaling, they don\u2019t have any money. So, cold calling is a good way to start because it is a low barrier of entry, fairly inexpensive versus, say, a PPC or versus direct mail. Everyone knows, if you\u2019re getting started in wholesaling and you go, the direct mail route and, say, you have couple of, goes at it and they all end up empty, that can sink you. That could literally sink you right off the bat.<\/p>\n

Luke:
So, cold calling is nice in that sense where it is a little bit less expensive, but once we were able to basically start stacking some cash, then it was like, \u201cOkay, you know what? Now we can start building a team because we can afford to start paying some people on the team.\u201d And so, that was really the main time was, I don\u2019t know if I would necessarily put $1 amount on it, but that was when we started building a team. That was also when we started looking into flipping.<\/p>\n

Rob:
Yeah, man. So, I know that you have a few, given the background, I think this led to you creating some gamification strategies for you and your team. Can you walk us through a few of those and how those shaped your business?<\/p>\n

Luke:
Yeah. In my opinion, if you are building a business, if you\u2019re starting a business out, I think the smartest thing that you can possibly do, the absolute smartest thing that you can do is 100% be yourself and build your business around you and around what you love and around what you\u2019re passionate about. Because, for instance, you can see behind me right now, I\u2019m a child, I\u2019m 32 years old, but I\u2019m a kid. I\u2019ve got all my sports cars behind me. I\u2019ve got Legos, I\u2019ve got a pirate set of Legos behind me. I think that what we were able to do is we were able to build this business around the things that we love.<\/p>\n

Luke:
My business partner, Jake and myself, we love sports. So, the things that we post online and everything with our company, it\u2019s about, we play golf in the office all the time. We\u2019ve got this chipping mat set up. We have sports center on all the time. That\u2019s on 24\/7 when we\u2019re in the office. We\u2019ve got a beer tap with kegs in the corner over here. So, we\u2019ve got a cooler with all drinks in it and stuff. So, I think that people need to realize that if you build your business around you, there are hundreds of thousands of people out there that have the same likes as you.<\/p>\n

Luke:
They have the same mindset, they have the same things that they enjoy that you do. And so, it\u2019s like you\u2019re going to attract these people. There\u2019s no doubt about it. And so, I think that so many people get, they put themselves in a box of, well, this is how business is supposed to be. This is how wholesaling is supposed to be. This is how real estate\u2019s supposed to be. Again, we wear t-shirts and tank tops and board shorts in here every day. We could give (beep) about what people wear, what we wear in the office. We\u2019re not a super, just, I don\u2019t want to say we\u2019re not professional, but again, we just run things a little bit differently.<\/p>\n

Luke:
So, I think that we\u2019ve been able to attract a lot of people that have the same likes and the same similarities as us. Everyone that\u2019s on our team now, we all play golf. We all watch ESPN. We get along, we\u2019ve built such a great bond and such a great team atmosphere. And it\u2019s because we\u2019ve attracted these people from the things that we\u2019ve posted because we\u2019re just being ourselves.<\/p>\n

Luke:
We\u2019re not trying to be something that we\u2019re not. We\u2019re not trying to be anything that we don\u2019t like. Everything in our office right now was handcrafted by us. And it\u2019s 100% us. So, I think that\u2019s huge and I don\u2019t think enough people do that.<\/p>\n

Rob:
Yeah. It sounds like what it boils down to is building that office culture, that is, I don\u2019t know, very vibrant within the culture. You want everyone to feel like it\u2019s an authentic place to come to work.<\/p>\n

Luke:
Oh, for sure. Absolutely. That\u2019s a thing. I don\u2019t know what the percentage is, but I\u2019d say most people still in general don\u2019t enjoy going to work when most of the days that I come in here, my guys are in here early. We don\u2019t ask them to be in here early, but they\u2019re in here early because they love it. They love coming to work. They love having our chipping challenges and then it makes work fun. You don\u2019t even feel like you\u2019re going to work. And again, everyone\u2019s still working. Everyone\u2019s still making money and everyone\u2019s pounding the phones. But again, we make games out of it.<\/p>\n

Luke:
We do certain things where it\u2019s like, okay, Hey, we\u2019ve made it a real team aspect, where one of the big things that we did as well is that when we set goals at the beginning of the year and we set goals quarterly as well, but we set team goals, we set personal goals for maybe things that, whatever, I want to lose 10 pounds this quarter or whatever. We take real-life goals that are going to be every single day type things. But then, we also have the team goals. And so, we think that\u2019s extremely important.<\/p>\n

Luke:
Because then, when people close deals on our team, there\u2019s no animosity. We had built that the wrong way in the past. And we learned from that mistake. When we were first getting going years ago, we had built the team out where it was in a sense, eat what you kill, every man for themself. And biggest mistake we ever made. No question about it. If you have a team that\u2019s set up that way, I don\u2019t recommend it one bit. There began being animosity between team members and stuff like that.<\/p>\n

Luke:
So, now, that we just have it all team-related, when people close deals, everyone gets stoked. Everyone gets jacked up when we take shots, when we close a deal. And so, it\u2019s like we set these awesome goals where we\u2019re going to go on a trip at the end of the quarter if we hit this number. We have fat bonuses at the end of the year if we hit the overall number for the year. So, we\u2019ve really been able to make it a team aspect type thing where everyone gets excited when everyone succeeds.<\/p>\n

Rob:
Yeah. I\u2019d actually like to dig into that aspect a little bit because I really like a rev share model in a sense, but that\u2019s not exactly what you\u2019re necessarily suggesting. It\u2019s not like one deal is closed, everyone gets a little piece of it. It\u2019s more, if everyone\u2019s closing a certain amount and then the entire office hits that goal, then there\u2019s a bonus that\u2019s dispersed from there. Can you walk us a little bit through those mechanics?<\/p>\n

Luke:
Yeah, no, exactly. Exactly, like you just said, everyone basically has a certain number that they\u2019re supposed to be hitting every month. So, obviously, that number comes down at the end of the year. Does everyone hit their number? Awesome. If everyone hits their number, then that\u2019s great. And then, if our company as a whole hits the number that we set out for, we have insane bonuses that we did.<\/p>\n

Luke:
It\u2019s not necessarily rev sharing, but we just threw out a really high number that everyone\u2019s going to get. So, obviously, it makes everyone super amped to shoot for that number.<\/p>\n

Rob:
That\u2019s really cool. So, are there times in that culture, obviously, you\u2019ve experimented here with the bonus structure and everything like that, different aspects of culture that you like to implement. Are there times where you can point to where it\u2019s like it wasn\u2019t working or ways that you can identify when certain cultural things aren\u2019t necessarily a fit?<\/p>\n

Luke:
Yeah, yeah, no doubt about it. So, we\u2019ve been in business for seven years now. Trust me, I\u2019m not trying to say, sit here and say we have it all figured out. But the last year has really been a game changer for once we restructured how everything worked. The previous years were, they were still good. But the beginning years we made the most mistakes as most people do, because you\u2019re just getting your business going and you\u2019re learning from your mistakes. But yeah, when it was, eat what you kill, every man for themself, like I said, there was a lot of animosity built up between people when someone would get a deal.<\/p>\n

Luke:
It\u2019d be like, oh Hey, they\u2019re getting better leads than I am, aren\u2019t they? Well, you told him to call on this list and I\u2019m calling on this list and how come this is happening? So, it got negative. And then, when that started, I don\u2019t know if you want me to go down the road of not fun stories, but again, these are learning experiences. But yeah, we had a guy that was on our team and he was a cancer to the team. Every time we brought in new people, he would come to us and be like, \u201cHey, I don\u2019t like this guy. I don\u2019t like this guy. I don\u2019t like this guy,\u201d for whatever reason it was. We should have caught that early.<\/p>\n

Luke:
We should have caught it early on that the guy was obviously, he was the problem every single time we brought in new people. And we ended up finding out that he had been stealing leads from us for the last six months that he had worked with us. And like I said, the relationship just started getting worse and worse. But then, one day we came in and all this stuff was moved out and he was like, \u201cHey, I\u2019m going to start working from home.\u201d And we\u2019re like, \u201cWhat? You\u2019re not going to work from home.\u201d<\/p>\n

Luke:
And he is like, \u201cNo, I\u2019m working from home from here on out.\u201d And so, we ended up finding out that he had been actually closing deals and using another company in our market to close them. So, he was taking the leads and he was finding it, he was taking the leads to this other company and he was closing them and selling them with them.<\/p>\n

Luke:
Because how it raised an eyebrow for us was we were like, \u201cOkay, you\u2019re not getting any leads anymore. What happened the last three months? You haven\u2019t brought any leads in. Something\u2019s got to be going on.\u201d And then, like I said, shortly after, he said he was going to start working from home. And then, we ended up finding out that the leads that we had been working, he had just been taking them and closing them.<\/p>\n

David:
In our industry, especially I think we are more prone to that behavior than in a W2 world, we tend to draw the people who have this dream. They want more money. They want financial freedom. They want to see what they can do. It\u2019s that personality that is pulled to real estate. It\u2019s typically not an accountant, CPA type person who\u2019s like, \u201cI really want to be in the chaos of real estate investment.\u201d<\/p>\n

Luke:
Right.<\/p>\n

David:
So, I\u2019ve noticed this with real estate salespeople to a smaller degree with mortgage loan officers, not quite as much, but definitely with the investor, the flipper, the person that\u2019s willing to cold call all day long that wants it really bad. They\u2019re more likely to be the people that will cross those lines that will gray those areas.<\/p>\n

David:
And there\u2019s almost like a bit of a paranoia that you have to develop to do this well, that people that don\u2019t work in the industry will look at it like, \u201cOh, you\u2019re always afraid of people leaving you.\u201d I\u2019m like, \u201cDo you know how often agents change brokers-<\/p>\n

Luke:
Oh, God. Yeah, it\u2019s insane.<\/p>\n

David:
They\u2019re constantly jumping. And then, in the investing side, it\u2019s even worse. You get these people that say, \u201cHey, I see you playing Madden and cold calling. I really want to learn what you\u2019re doing. Can I come work with you?\u201d And their goal is, as soon as I get this down, I\u2019m leaving this guy.<\/p>\n

Luke:
I\u2019m out of here.<\/p>\n

David:
I\u2019m going somewhere else.<\/p>\n

Luke:
Yes, absolutely.<\/p>\n

David:
But they don\u2019t just want an opportunity. They want your time, your training, your attention, your emotional commitment. You get to know these people you feel like your friends, it could even be family. You\u2019re sitting out there with these guys right outside your window. You guys are going to war together. It\u2019s going to build this bond. And it stings when one of them leaves, especially if they leave to betray you.<\/p>\n

David:
So, first off, I just wanted you to talk a little bit about this reality that doesn\u2019t get brought up in the Disneyland real estate investing persona that gets put out there. Because it\u2019s actually a little more cutthroat than I think a lot of people can realize. And then, what you\u2019ve done in your company to try to avoid that, whether it\u2019s looking for traits in people that you avoid or creating an incentive structure so that\u2019s less likely to keep happening.<\/p>\n

Luke:
No. For sure. Exactly like you said, once we did shift that mindset of, okay, we\u2019re bringing people on, but exactly, like what you said, they\u2019re gathering information from you and then they\u2019re out. They might stay a couple of months. Even if it\u2019s a year, they get as much information as they possibly can. And then, when it\u2019s no longer fitting their needs or it doesn\u2019t really make sense, they think that they can start making more then they\u2019re gone.<\/p>\n

Luke:
And so, what we\u2019ve done to try to combat that is when we did our last round of interviews, we really asked some deep questions, some deep questions that were going to be, give us a good feel for if these people were going to stay with us or if they were literally just trying to gather information and bounce. One of the things that we said is we just asked, how long are you looking to stay in real estate? How long are you looking to be with us? Just curious.<\/p>\n

Luke:
Because, believe it or not, even though you\u2019d think a lot of people are just going to BS you, a lot of people will straight up tell you. We had a couple of people that were like, \u201cHey, I want to be here for maybe a couple of years. And I\u2019d go try to do what you guys are doing.\u201d So, someone that said that, no, you gave us the honest answer, but that\u2019s the wrong answer. So, no, you\u2019re not working with this.<\/p>\n

Luke:
And so, it\u2019s like, yeah, we were looking for the people that said, you know what? I\u2019m looking for a career. I\u2019m looking for something that I can stay at long term. So, that was huge for us. Another thing, we want our guys to grow, we want them to grow with us. So, that was another huge thing that we shifted as well, is that when we go over our goals, the personal goals and the team goals, but when we go over those, we really look to find what is it that you want? You know what I mean?<\/p>\n

Luke:
We try to get to the deep questions of what do you want out of life? What do you want out of working here? And so, a really cool example that I can actually use that just actually happened last week. One of the guys on our team, one of his goals was that he wanted to buy three doors this year. He wanted three, wanted to pick up three rental properties, three doors. And so, one thing that we\u2019re huge on is we like to try to fulfill these goals with people.<\/p>\n

Luke:
And so, we like to give, we made it very obvious to them that, \u201cHey, we\u2019re going to be able to provide you guys with options in opportunities that you might not get elsewhere because of how many projects we do come across.\u201d This was only a week ago. We came across a triplex that was a seller carry with interest rates where they\u2019re at right now. Seller carry was pretty attractive. They were asking 880 on it for triplex right downtown Prescott. The seller was asking 880 and they said they had carry at 4.7%.<\/p>\n

Luke:
So, we went ahead and jumped on. We lowballed the (beep) out of them. We came in at 650, 4.7% interest and they accepted it. So, five-year balloon. So, it was a perfect time though, where we could see if it was something that he would be interested in jumping in on with us. And so, our team member jumped in on it with us.<\/p>\n

Luke:
He threw some cash down to partner on it. And he is a partner with my business partner, Jake, and I on it now. So, it\u2019s just like that. He just added three doors to his portfolio. And that was one of his big, big goals that he had wanted to do for the year of 2022. And it\u2019s already accomplished.<\/p>\n

David:
That\u2019s awesome. Rob, same question to you. What are some things that you\u2019ve done to either avoid hiring the wrong people or keep the people that you\u2019ve got in place?<\/p>\n

Rob:
This is something that I\u2019m actually, I don\u2019t want to say dealing with, but something I\u2019m going through right now because I\u2019ve always hired very lean and I\u2019m at the point now where I am having to scale and hire more people. And I just want to make sure that the people that I\u2019ve already hired are happy. So, I actually just had a one-year review with my editor, for example, the editor of the channel. And for us, we\u2019ve had a really good, flexible relationship. Things have been going super, super, super well. And I believe he gets paid relatively well for the job that he does.<\/p>\n

Rob:
And I think we\u2019ve always been happy with that, but I did want him to have skin in the game because I always feel like having skin in the game is truly where the incentive comes to light. And so, when we had our one-year talk about a week ago, actually, it wasn\u2019t really that long ago. And I said,\u201d Look, I could give you a raise if that\u2019s what you want. But what I would prefer is we\u2019ll keep your salary the same but I\u2019m going to give you a percentage of the ad revenue of the channel.<\/p>\n

Rob:
But what I want though with this is you now have a stake in this channel in the success of it. So, if the YouTube channel goes viral, you\u2019re super happy. If it\u2019s tanking, I want you to be bummed about it with me.\u201d And so, this is something I\u2019ve figured out because I think just doing pure skin in the game has not worked in the past for some people that I\u2019ve consulted with on this. But I actually just hired a COO for my education program. And we really went through and through trying to figure out the agreement that worked the same thing.<\/p>\n

Rob:
It was a base salary with a percentage of revenue because basically, if he grows it to a certain milestone, he\u2019ll make a lot more money. And so, for me, I think there\u2019s a really nice balance there of just making sure that there is a reason that someone comes to work motivated in knowing that their work contributes to more money in their pocket.<\/p>\n

David:
For me, long story short is I\u2019ve noticed that I do better hiring administrators than salespeople. So, most of the problems that come in my business would be a salesperson that comes in and we want them to work a system and be structured and follow a path. And they\u2019re a crazy squirrel that wants to run all over the place and their heart tells them, do it your own way, but their head tells them, I need systems, and it\u2019s been very difficult keeping them passive. We\u2019re going to restructure to where we\u2019ve got a handful of sales leaders that are very talented agents.<\/p>\n

David:
We\u2019re going to build administrators around those people rather than growing agents and maybe giving them agents to support them because this has been the biggest problem with businesses. You just don\u2019t realize that when you\u2019re learning about real estate, it\u2019s so exciting. It\u2019s so fun. You\u2019re like, \u201cI just want to do this every day, all day.\u201d But then, when you got to go execute, it becomes boring. It becomes monotonous. It becomes a grind that you learned how to use Madden as an opiate to get you through while that was going on.<\/p>\n

David:
And that\u2019s why people don\u2019t become successful is when the luster wears off. And you\u2019re like, \u201cNope, I\u2019m just getting yelled at, getting hung up on, getting people that are irritated. And I\u2019m just sifting through to find that one gold nugget. And then, I got to have the ability to pounce on it when I find.\u201d It could be like that, getting a deal. We\u2019re starting to see a little bit more deals coming our way because the market is softening. But in general, it becomes very discouraging when you\u2019re looking at house after house especially when you\u2019re new and you\u2019re just analyzing all of them 100%.<\/p>\n

David:
This is exhausting and you got to have the energy to pounce when that one comes. So, I want to switch this over a little bit. Luke, if you could give us your four tips that you use to keep people interested so that their mind is sharp, they\u2019re engaged, they\u2019re having fun and they don\u2019t miss the opportunity that comes after those eight hours of calls.<\/p>\n

Luke:
Yeah. So, another thing that we do is we incentivize our team for bigger deals. Because again, you got to keep in mind, we\u2019ve got sales team that they are in the trenches and they\u2019re going to be negotiating a deal. So, if they\u2019re negotiating a deal, why not give them more incentive to try to get that deal deeper? And so, obviously, we\u2019re not going to give the deal away. We don\u2019t want to lose a deal because we\u2019re just trying to get it too deep.<\/p>\n

Luke:
We\u2019re always going to try to make sure that we get the deal first, but we incentivize them by getting deeper deal. So, we\u2019ll do something where it\u2019s like, \u201cOkay, for your first 100k deal that you get, we\u2019re going to get you a whole new set of golf clubs.\u201d Are you guys golfers?<\/p>\n

Rob:
I just took my first lesson a week.<\/p>\n

Luke:
Oh, did you? Okay. That\u2019s a couple of grand. That\u2019s a couple of $1000 right there to do something like that. Or your first deal over, whatever, 50 grand or 75 grand. So, we do different things like that. So, you\u2019ll get an electric scooter, you\u2019ll get an electric e-bike. So, we do things like that to really try to make them push, to get them deeper. So, that\u2019s one obviously.<\/p>\n

Luke:
Another one is we really make sure that we have an advancement. So, it\u2019s like, \u201cOkay, this is what you\u2019re going to start out at when you join our company.\u201d But we always want to make sure that people know that they can grow in our company.<\/p>\n

David:
That\u2019s huge.<\/p>\n

Luke:
Yeah. Because a lot of times, I think that one reason why people will leave a company is because they just feel like there\u2019s not any growth for them.<\/p>\n

David:
That\u2019s me.<\/p>\n

Luke:
They feel like they\u2019ve hit the ceiling and they\u2019re like, \u201cOkay, well, where do I go from here? I\u2019m doing well. And I don\u2019t really know what you guys want from me now because I\u2019m doing everything I can do. And I just don\u2019t.\u201d And they just feel like they hit that glass ceiling. And so, one thing that we\u2019ve really done is we\u2019ve really made it a point that we want you guys to advance in our company. We have an opportunity for growth. You\u2019re starting right here as an acquisition manager, but the next step is going to be a team lead. The next step is going to be a closer.<\/p>\n

Luke:
We\u2019re going to have positions all the way up to COO of our business as well. We\u2019re not there yet. Our team\u2019s not big enough. And I don\u2019t think, especially with the market slowing a little bit, we\u2019re just not really at that point where we have those upper management positions filled or anything. Or even really where we\u2019re ready for. But again, I think that just when people know that for the future, I can step into those positions.<\/p>\n

Luke:
I\u2019m not going to just stay right here for my entire career with them. That\u2019s a huge thing. And when you say gamifying, it\u2019s like, in my opinion, it\u2019s moving onto the next level. So, it\u2019s like you\u2019ve finished this level and you\u2019ve done really well. So, now you\u2019re moving onto that next level.<\/p>\n

David:
I heard Tony Robbins talking about this and it never really clicked, but he was talking about how important the feeling of progression is to a human being. It\u2019s one of our deepest needs. Actually, I think what he was saying is you\u2019re only happy in life when you can feel like you\u2019re progressing. And at the time I heard it, I wasn\u2019t ready to hear it. So, it didn\u2019t really do anything for me. But I started thinking about, actually, I\u2019ll just be honest with this. I started playing a video game on my phone, a Marvel game, and I ended up spending money on it. And I was like, \u201cWhat the hell am I doing? This is so stupid in so many ways.\u201d<\/p>\n

David:
But I actually deconstructed, why am I spending money on this? And they did done a great job in that game of getting it started, where it was fun and then making it too hard to progress at the pace that you want to that you got used to unless you spend money. So, you\u2019re in this pain, I can\u2019t get to this next level unless I spend $10 and then the pain is relieved. And I just caught myself getting sucked into just like, it\u2019s like, \u201cDude, I don\u2019t spend this much money on food. I don\u2019t spend\u2026 why am I doing this?\u201d<\/p>\n

David:
And it was that feeling of progression and it unlocked something in my brain. I realized, \u201cThis is why you see so many young men that are addicted to World of Warcraft, that in the real world they don\u2019t get that feeling of progression. They feel like they\u2019re getting passed up in that world. They\u2019re at level 74 Warlock. And even though they know it\u2019s not real, your brain thinks it is. It feels real.<\/p>\n

Luke:
Like, I am a badass.<\/p>\n

David:
In that place, right? And I see this with investors. I\u2019ll often hear investors say, \u201cI have X amount of doors.\u201d And it\u2019s a joke in our world that the minute I hear an investor start talking about doors, they\u2019re chasing the wrong goal. It\u2019s easy to build up doors. Because they have nine doors. What you have is three properties or something. It\u2019s the feeling of progression that they like people to hear. And now, I pay a lot of attention to what am I getting that feeling from. Because I will chase it if I think that I\u2019m going to get ahead.<\/p>\n

David:
And there\u2019s a lot of other people that are that way. And if you\u2019re at a company where they don\u2019t have that feeling of progression. It\u2019s almost like you\u2019re forcing them to go somewhere else to find it, to get that need met.<\/p>\n

Luke:
Yeah, no, there\u2019s no doubt about that. I think there\u2019s so much truth in that because this is when you just even talk to the team, when you just have regular talks with them, that\u2019s what is important. When you have the sit-downs with them and you say, \u201cHey, what\u2019s really important for you with where we\u2019re at?\u201d It\u2019s always that next thing.<\/p>\n

David:
How about you, Rob? What are some areas where you catch yourself like you feel progression and so you pursue it, but then you look back and say, \u201cWas that even worth doing?\u201d Or are you just a machine that isn\u2019t making those mistakes?<\/p>\n

Rob:
I don\u2019t make mistakes. [inaudible 00:36:19]. Yeah. I\u2019m the best. That\u2019s my Ricky Bobby impression. Well, no, I was just thinking about that and I said this earlier about of the rev share model. And I think honestly, you guys are really selling me on this a little bit more simply because there is progression in that type of thing for the people on my team with my COO, with my editor. They\u2019re directly incentivized by the performance and growth of my company. And thus, if they don\u2019t help increase the production, they don\u2019t see progress.<\/p>\n

Rob:
But because of our company, because my company is in my channel, it is always growing. I think that\u2019s probably, honestly, David, what I did not like about W2 life is that there really isn\u2019t fast progression. If you think about your typical linear growth there, you get a job and you wait, if you\u2019re lucky a year to get promoted, but it might take two, it might three years to get promoted. Now, you might get, like at my last job, I would get a 3% living wage increase every year or two.<\/p>\n

Rob:
I can\u2019t really remember off the top of my head. That\u2019s not real progress. It\u2019s not nothing, but on my salary, it was, a couple of $1000 for example, which, after taxes and everything was like, well, an extra $50, $100 per paycheck.<\/p>\n

Luke:
Inflation.<\/p>\n

Rob:
And that\u2019s not real progress. Right. Exactly. That\u2019s exactly what I did. It wasn\u2019t even keeping up with inflation. But when you think about leaving one job to go to the next job, your salary jump can be very sizable. You can go from making 50,000 to 75,000 if you play your cards right or maybe 80,000. There are jobs that I went, I was able to jump. Like when I moved from Kansas City to Los Angeles, I was able to double my salary and that\u2019s where I felt real progress. But once I was locked into the W2, there is no progress for one, two or three years.<\/p>\n

Rob:
And I think the way you describe that is exactly what my gripe was with my full-time life was that I just never felt like I was really seeing progress because I was like, \u201cOh, well my employer doesn\u2019t see enough progress to give me a raise or give me a promotion.\u201d And thus, I always felt very stagnant for very many years. Whereas now I\u2019m self-employed, I have different businesses, I have different employees, my revenue does go up every single month. My views go up every single month and I actually see progress.<\/p>\n

Rob:
And so, I think, yeah, I don\u2019t know. I probably do chase progress a lot, but maybe it\u2019s because I was so deprived of it working a full-time career. And that\u2019s why obviously, your mileage is going to vary there. And I didn\u2019t mean to get so deep and profound, but I think you\u2019ve just really encapsulated what my issue was with being a company man.<\/p>\n

Luke:
Oh, for sure. When it comes to just talking what my main thing that I chase is for progress-wise, it sounds ridiculous, but it\u2019s 100% cash flow. That is literally the number one thing that I find myself chasing is the number that sticks out to me over anything else is 100% directly correlated to my freedom. And the thing that correlates with your freedom for me is my cash flow.<\/p>\n

David:
I think because cash flow is such a powerful magnet in our industry. It\u2019s like you throw the word cash flow out and 90% of the people interested in real estate are going to run right after.<\/p>\n

Luke:
For sure.<\/p>\n

David:
And it\u2019s not bad, obviously, cash flow is incredible.<\/p>\n

Rob:
I want to make money.<\/p>\n

David:
It becomes scary when someone goes to a bad turnkey provider or a bad market because those markets always look stronger cash flow. If you go to Indiana, if you go to some of these Mississippi, all these areas that turnkey companies tend to work in that have a very low barrier to entry on the spreadsheet, you\u2019re like, \u201cWhoa, this is a 28% return.\u201d And it never works out that way. And it\u2019s not that I\u2019m against cash flow. I\u2019m against cash flow being used as bait to get you on a hook, that\u2019s going to take you in a financial ruin.<\/p>\n

David:
And you got me thinking, one of the thing, I think the main reason people want cash flow is they see it as this magic pill to get them out of the job that they don\u2019t like into a relationship that they don\u2019t have, into having confidence. Just cash flow can change everything for you. The other thing I think is it\u2019s easier to measure progress with cash flow.<\/p>\n

Luke:
No, I think so too.<\/p>\n

David:
Hey, I\u2019ve got this much every month. I can get this much more if I get this many properties. It puts you on that progression system that we talk about. You can do the same thing with equity. And that tends to be how wealthier people measure their successes. How did my net worth grow? But you don\u2019t have as much direct control over equity. You have to make the right moves and watch that it happens. But cash flow, there\u2019s a very strong correlation between I got this many doors, I can get this much cash flow.<\/p>\n

David:
So, I\u2019m curious as you\u2019re building up your own portfolio, as you\u2019re growing your cash flow, and as you\u2019re seeing this system of progression and how important we have to have it, or otherwise we\u2019re not going to stay motivated. But at the same time, you can follow the wrong path and feel like, I\u2019m making progress, and then you get all the way to the end. And you\u2019re like, \u201cI don\u2019t like where I went. This was a mistake.\u201d How often do you pull back and look at your overall plan and ask yourself if you like the direction you\u2019re headed?<\/p>\n

Luke:
Probably monthly. Honestly, I\u2019d say probably about once a month I really sit back and I\u2019ll look at it and just be like, \u201cOkay. Is this where I want to be? Is this what I want to do? The things that we\u2019re aiming towards, is that what I want out of life and are we going in the right direction towards those things?\u201d So, again, like you said, whether it\u2019s right or wrong, measuring it in cash flow, when I take a look at that, I put it in words of, with this, whatever this number is going to grow to, looking at it regularly, this lets me know where I\u2019m at on paper in the sense of, okay, in a recession.<\/p>\n

Luke:
And again, not saying we\u2019re in one, but I\u2019m just saying, if things do come crashing down, this is what I can still hang my head on that. This is where I\u2019m at, where I don\u2019t necessarily have to worry too much if the world explodes and your business falls apart. You know what mean? Obviously, there\u2019s not things that you want to happen. There\u2019s not things that you expect to happen. But there are things that can still come through your mind where it\u2019s like, \u201cOkay, if everything does fall apart, where are you sitting cash flow wise?<\/p>\n

Luke:
Because this is what allows you to still survive. This is what\u2019s going to allow you to be like, \u201cHey, you know what, no matter how bad it gets, this is where I\u2019m at. And I can still go do this. I can still do this and I can still have this type of a lifestyle based on that number.\u201d And so, that\u2019s why I try to stay on top of that number regularly because with the shifting market right now, it\u2019s nice to know. It\u2019s nice to know what that number is.<\/p>\n

Rob:
That\u2019s interesting because I would\u2019ve imagined that the, I don\u2019t know. Yes, I agree with a lot of that. I guess I would think of it this way. Your cash flow is your daily tracker. That\u2019s what you\u2019re looking at. That\u2019s what\u2019s on the scoreboard. But you got to look at the season like what the season, where you net out. And that\u2019s where I look at net worth, which again, net worth isn\u2019t something that I\u2019m really looking at and saying like, \u201cGreat, boom, box checked.\u201d But that is the ultimate for me, the tracker of the overall success. Because cash flow can change. You can sell a property.<\/p>\n

Rob:
There are a lot of times I\u2019ve had a great Airbnb that lease might have ended or I might have sold it or whatever. And I\u2019m like, \u201cDang, that just took off $7000 of my cash flow. And now I\u2019m back down to, three steps back or whatever.\u201d And again, net worth is not something that I\u2019m like, \u201cOh yeah, this is it.\u201d But that is how I track really a lot of it because for me, I always say, cash flow makes you rich, but equity makes you wealthy.<\/p>\n

Rob:
So, there is a little bit of a dance that you have to play on which one you\u2019re paying attention to. And I think it\u2019s equal, honestly, on my side.<\/p>\n

Luke:
I was going to say, I absolutely still pay attention to my net worth as well, but I pay more attention to my cash flow regularly. Like I said, I\u2019m probably paying attention to my cash, checking on my numbers for cash flow monthly. And then, my net worth is probably quarterly where I\u2019m really diving in and saying, \u201cThis is where I\u2019m at right now. How am I going to grow this number right now?\u201d<\/p>\n

David:
All right. So, let\u2019s summarize your four tips for gamifying things. And I think before I do that, what I love about this is that you\u2019re taking the same things that make video games fun and addicting. You are applying them to business so people can actually make money with that skill, right?<\/p>\n

Luke:
Hell, yeah.<\/p>\n

David:
You\u2019re taking this thing that is trap to so many people and now you\u2019re using it in the fight for financial freedom and good. So, I like that.<\/p>\n

Luke:
Absolutely.<\/p>\n

David:
Number one tip, make work a game. When you were using Madden, that would make an ordinary boring task actually seem a lot more fun and challenging. Number two is look for ways to incentivize people and you have to have weekly ones and a quarterly ones, different forms of incentive. Number three is leveling up. That\u2019s where we get into that feeling of progression that\u2019s so important.<\/p>\n

David:
Number four is bring in a multiplayer element. So, get other people involved, make them feel like they\u2019re in a group on a team. Anything that you want to elaborate on that before we move into the next segment of the show?<\/p>\n

Luke:
No. Honestly, one other thing that we\u2019ve really done with our team as well is we\u2019ve made sure that they all know that to us, one of our core values is obviously just the importance of family. And so, something that\u2019s big is we give our entire team so much freedom in the sense that if they ever need anything, if they ever want to take a trip, they can ask us, but they really don\u2019t even need to. It\u2019s done. It\u2019s done. So, there\u2019ll be times when anyone on our team, they can say, \u201cThis is coming up. This is going to do this.\u201d Perfect. You\u2019re gone. Have fun, enjoy it and enjoy your time with the family.<\/p>\n

Luke:
And so, we\u2019ve made sure that everyone knows how important it is to us, that they get their time with their family. And again, that\u2019s not gamifying, but that\u2019s just one of those things to us where again, it\u2019s a core value that your family comes first. So, anything you need, go for it.<\/p>\n

David:
And if they\u2019re hitting their numbers, if they\u2019re doing their job, if there\u2019s accountability, I see that you\u2019ve got these people that are in your office as we\u2019re recording. I think that\u2019s really important.<\/p>\n

Luke:
Oh, yeah.<\/p>\n

David:
You know they\u2019re working every day and you track your numbers. So, you see if they\u2019re successful. So, of course, if they want some time off, they can go do it. That only becomes a problem when someone\u2019s not contributing. They\u2019re not helping move the ball forward. And then, they\u2019re saying now, \u201cI need all this time off as well.\u201d<\/p>\n

Rob:
I agree. I\u2019m jealous. I\u2019m jealous. You have a workspace with people. I do miss that. The studio gets a little lonely sometimes.<\/p>\n

David:
Rob\u2019s coworkers are his children. How old are they?<\/p>\n

Rob:
One and two.<\/p>\n

Luke:
There we go.<\/p>\n

David:
And every once in a while, an exciting thing happens where one of them sticks playdough up their nose and you get-<\/p>\n

Luke:
Perfect. There we go.<\/p>\n

Rob:
And do reverse CPR. Yes.<\/p>\n

Luke:
We had a peanut incident about six months back. So, peanut up the nose.<\/p>\n

Rob:
Up the nose?<\/p>\n

Luke:
Up the nose.<\/p>\n

Rob:
What happened? Did you do reverse CPR?<\/p>\n

Luke:
We had to break out the tweezers. Had to break out the tweezers to get the peanut out. I\u2019m like, \u201cBabe, what are you doing?\u201d She\u2019s like, \u201cI put a peanut up there. I thought it would come out.\u201d<\/p>\n

Rob:
My sister did that with the bean one time.<\/p>\n

Luke:
Yeah. We\u2019ll get you peanuts and beans.<\/p>\n

Rob:
She was 32.<\/p>\n

Luke:
Yeah. Right.<\/p>\n

David:
All right. I\u2019m going to move us on to the next segment of our show. In this segment of the show, we are going to ask you details about a particular deal that you\u2019ve done. Luke, do you have one in mind?<\/p>\n

Luke:
We\u2019ve got one flip that we just did.<\/p>\n

David:
The first question is what property is it? Was it a single-family home?<\/p>\n

Luke:
So, it\u2019s a single-family home, but it has a guest house, five minutes from downtown Prescott. So, it\u2019s in a really, really sought-after area. And so, it is on 1.2 acres. And again, you don\u2019t typically find many houses with guest houses in this area. House is 2400 square feet. Guesthouse is 600 square feet, completely separate.<\/p>\n

Rob:
And how did you find it?<\/p>\n

Luke:
This was a cold call.<\/p>\n

David:
And you mentioned the price. How much did you pay for it?<\/p>\n

Luke:
Bought it for 480,000.<\/p>\n

Rob:
And how did you negotiate that price?<\/p>\n

Luke:
So, the guy wanted 550. He was going to list it on the market for 550. So, obviously, we broke down all the numbers for him. Just let him know that by the time you actually list it and after all the numbers come out, it needed everything. It was really rough. So, after an inspection and everything, we\u2019re like, \u201cHey, there\u2019s a good chance you\u2019re not going to walk with 500.\u201d So, went back and forth there. We got them down to 480 on the deal.<\/p>\n

David:
All right, how did you fund this deal?<\/p>\n

Luke:
This one, we did a hard money loan and we did a hard money loan for the construction on it as well. And then, the construction ended up getting a little out of hand on us. So, we actually had to bring in a gap funder. We didn\u2019t have to, but we brought in a gap funder for the extra construction loan.<\/p>\n

Rob:
And what did you do with it? Was it a flip, rental, BRRRR?<\/p>\n

Luke:
It was a flip. So, yeah, we ended up putting 260,000 into the flip.<\/p>\n

David:
All right. And what was this outcome?<\/p>\n

Luke:
So, we just listed it last week, which again, in this market right now is a little bit scary, just because we talked about it a little bit before, but the numbers have come down. There\u2019s no doubt about it from where they were versus six to eight weeks ago. So, obviously, that\u2019s something that was scaring us as we were getting closer to getting this thing listed. We\u2019re just watching the market, watching interest rates going up. We\u2019re like, \u201cOkay, we\u2019ll just have to see how this goes.\u201d<\/p>\n

Luke:
But we\u2019re pretty confident in our product that we put out. We put some money into our pro projects and we got a pretty good design in our opinion. So, we listed the property for 1.1 mil last week, and we got a full-price cash offer three days in.<\/p>\n

Rob:
Wow. That\u2019s awesome, man. What lessons did you learn from the deal?<\/p>\n

Luke:
It was a little bit scarier deal, because it took a while because we gutted the entire thing. It was rough. It was really rough. But what I learned, man, we trusted our intuition that this was going to be, just because of what it was. It\u2019s a really cool house. It\u2019s old, unique. It\u2019s got a lot of history behind it. It had a guest house, it was on a big lot. So, it had these things that you don\u2019t find in this area. And so, we\u2019re like, \u201cI think we should be able to push this thing.\u201d And obviously, the market just continued to climb over the past year that we\u2019ve owned this property.<\/p>\n

Luke:
So, really, the thing I learned I\u2019d say is that we trusted our intuition that this was going to be a banger and it was. So, we just got through the inspection and they didn\u2019t ask for very much. It sounds like things are moving forward and they waved an appraisal, which was awesome.<\/p>\n

David:
All right. On this deal, who was the hero involved?<\/p>\n

Luke:
I\u2019m going to say it was our lender. Our lender just kept giving us funds. I think we\u2019d originally said that our rehab was going to be like, I think we said it was going to be like 120. And then, once we started getting into it more, you\u2019ve had those projects where you\u2019re like, \u201cOh, damn, this thing. Once we\u2019re opening this thing up, we\u2019re going to really get into this.\u201d So, he trusted us the whole way through. We do a stupid amount of deals with him. So, I\u2019m happy that he trusted us, but he just kept cutting the checks left and right. So, it was nice.<\/p>\n

David:
That\u2019s nice.<\/p>\n

Luke:
Yeah. So, find yourself a lender that will do that. Yeah, exactly. I think it\u2019s super important in my opinion to have a lender that if you want to get to that next level, you got to have a lender that you can just trust and they trust you that you can feed off of. Because if you don\u2019t have that, it\u2019s going to be tough.<\/p>\n

David:
And if you want to be Luke and get the same results, remember BiggerPockets can help you do so. There are tons of resources and people waiting to be your hero on the site. Just go to biggerpockets.com. Look for the nav bar, click on Tools or Resources. And there is plenty there that will help you do the same thing. All right. Luke, we\u2019re going to move on to the last segment of the show. It is the world famous-<\/p>\n

Speaker 4:
Famous four.<\/p>\n

David:
All right. In this segment of the show, Rob and I will fire questions at you and we are going to see how you respond. Same questions we ask every guest every week. Question number one, what is your favorite real estate book?<\/p>\n

Luke:
Ooh, favorite real estate book. I\u2019m going to have to go, I say that it\u2019s real estate wise, but The Top Regrets of the Dying. The Top Regrets of the Dying is huge for me because it\u2019s one of those things where again, it lets you know you got one life and it\u2019s about someone who interviewed a bunch of people that were on their deathbed. And just the things that they had brought up that they wish they would have done looking back and the tears that had brought to them.<\/p>\n

Luke:
Oh, man, it\u2019s one of those books where every single, every page, you\u2019re thinking about it, and you\u2019re like, \u201cOh my God, I got to change something. I got to go after it now. I got to do what I want to do right now.\u201d So, that was huge for me.<\/p>\n

Rob:
That\u2019s awesome. What about your favorite business book?<\/p>\n

Luke:
Favorite business book is probably going to have to be The Monk Who Sold His Ferrari.<\/p>\n

David:
Josh Dorkin really likes that book. He\u2019s mentioned it several times.<\/p>\n

Luke:
Yeah. That\u2019s an amazing book. That\u2019ll shift your mindset as well. It\u2019s about a big wig, lawyer and just the changes that he made by basically stepping away from his business and taking a deeper look at everything in the macro of life, I guess, and how it changed everything. It\u2019s amazing.<\/p>\n

Rob:
And when you\u2019re not finding ways to gamify the game of real estate, what are some of your hobbies?<\/p>\n

Luke:
I like to play golf. I like to spend time with the family. We\u2019ve got a boat, so we\u2019re on a little lake in our neighborhood here. So, we\u2019ll take the boat out, take the kids and the dog. So, that\u2019s a lot of fun, in Arizona. I know it sounds really weird. Most people are like, \u201cThere\u2019s not lakes in Arizona, right?\u201d So, that\u2019s fun. Golf. I enjoy playing basketball. So, like I said, I love sports.<\/p>\n

David:
Awesome. In your opinion, what sets apart successful investors from those who give up, fail or never get started?<\/p>\n

Luke:
Consistency, man. You\u2019ve heard that question when people ask, what\u2019s your superpower? Consistency, if you have the ability to just stick with it, even when things aren\u2019t going well, just pound the phone, whether it\u2019s the phones or whatever it is, pound the pavement and just continue to work. There\u2019s so many people, like you said, that when things get tough, they quit. They\u2019re just like, \u201cYou know what? This isn\u2019t for me. I\u2019ll do something else.\u201d That\u2019s not pivoting. If you\u2019re completely getting out of that industry, you\u2019re quitting.<\/p>\n

Luke:
And so, we have been able to stay extremely, extremely consistent in the things that have worked for us. And then, once they maybe start to not work as well, we have done a very, very good job of pivoting. So, whether that\u2019s a market shift. That could be anything. Something happens with your marketing sources or whatever it might be, where things are just not working how they used to work.<\/p>\n

Luke:
Making those changes, being able to pivot quickly and staying consistent, those are the top two things for me that if you can do those things in any market, in my opinion, I think you\u2019re going to be fine. I think you\u2019re going to do, not even be fine, I think you\u2019re going to excel.<\/p>\n

Rob:
Well, very wise words there. Lastly, can you tell us where people can find out more about you on the internet?<\/p>\n

Luke:
Yeah, absolutely. So, on Instagram, my Instagram handle is luke_ro_, and on Facebook, just Luke Rotvold. That\u2019s my full name. And then, on YouTube, we are under the Viking Boys and we have a bunch of cold call videos, just live cold call videos on there while playing Madden, which is a blast. So, yeah.<\/p>\n

Rob:
Don\u2019t stick to your roots.<\/p>\n

Luke:
Exactly. So, yeah, so those are the three places you can find me.<\/p>\n

Rob:
Awesome. What about you, David?<\/p>\n

David:
You can find me @davidgreene24. There\u2019s a whole lot of imposters, so be careful that you look exactly for the right spelling, especially if you see me follow you. Nothing personal, but I\u2019m probably not likely to be following someone that I haven\u2019t been interacting with before. There\u2019s a lot of people getting taken advantage of. And then, you can check up my YouTube channel @David Greene Real Estate. And Rob, what about you?<\/p>\n

Rob:
Yeah, man, I\u2019ve been waiting for you to follow me back now for the last six months. I try not to take it personally, but honestly, don\u2019t know how else to take it at this point.<\/p>\n

Luke:
It\u2019ll come soon.<\/p>\n

Rob:
You can find me over @Robuilt on YouTube, Robuilt on Instagram. Little curve ball here, Robuilto on TikTok because someone took Robuilt. But then, scammers got a hold of Robuilto on Instagram. It\u2019s a little confusing. So, I\u2019m Robuilt on Instagram and make sure that you, I mean, I won\u2019t send you a message first. I can pretty much guarantee that. So, if you get a message from me that says, \u201cHey, have you considered forex trading,\u201d it\u2019s not me. It\u2019s a bot.<\/p>\n

Luke:
Come on. That\u2019s what you\u2019re actually doing. Let\u2019s be honest here.<\/p>\n

David:
Luke, I got to ask you. With your name being Luke Rotvold, how often do people think that you are Luke Rockhold, the UFC fighter?<\/p>\n

Luke:
I know. Trust me. Oh, my God. Okay. So, funny story, the first time I ever heard that name, I was at a restaurant with my wife and they had ESPN or something on where they had highlights going on. And I just heard that name over, whatever the speakers. It was something about Luke Rockhold. And I\u2019m like, \u201cWait, babe, did you just hear that?\u201d And she\u2019s like, \u201cYeah, I did hear that.\u201d I\u2019m like, \u201cCome on, Luke Rotvold, that\u2019s not a very common name.\u201d Rotvold, it\u2019s a very strange name, is Norwegian.<\/p>\n

Luke:
But the first time I heard it, I was shook. I\u2019m like, \u201cWhat the hell was that?\u201d So, I don\u2019t get that very often. But I think that guy is also 6\u20194\u2033, freaking 240, yoked-up. I\u2019m not 6\u20194\u2033, nor am I 240 or yoked up.<\/p>\n

Rob:
Not yet.<\/p>\n

Luke:
Right. Hey, I can get there. I can get there. You put your mind to it.<\/p>\n

Rob:
Anything could happen.<\/p>\n

David:
You don\u2019t need to do that. Just get enough cash flow. It\u2019ll solve every problem you ever have. Why get in shape?<\/p>\n

Luke:
Boom. Exactly. That\u2019s what I\u2019m talking about. See? That\u2019s exactly what I\u2019m talking about.<\/p>\n

David:
All right, Luke. Well, we had a great time talking to you. I really appreciate you sharing what\u2019s going on in your business that\u2019s good, as well as what\u2019s not going well. It\u2019s very rare you get someone that will come in a podcast this big with this Mitch influence, and share, hey, I got taken advantage of, I had people leave me, here\u2019s what went wrong in the business.<\/p>\n

Luke:
Absolutely.<\/p>\n

David:
So, I appreciate you being authentic there. Everyone, please go follow the Viking Boys and learn more about how you too can make eight, what was it, $5000 an hour while playing Madden?<\/p>\n

Luke:
Five sixty.<\/p>\n

Rob:
Five hundred and sixty-three.<\/p>\n

David:
Five hundred sixty-three dollars an hour while playing video games. You\u2019re not going to get that in World of Warcraft.<\/p>\n

Luke:
No, you\u2019re not. No doubt about that.<\/p>\n

David:
Rob, any last words?<\/p>\n

Rob:
No, that was a really, yes. No, I\u2019d like to make $560 playing video games. So, I\u2019ll reach out on Instagram soon.<\/p>\n

Luke:
Boom, do it. We\u2019ll play a little Madden with mono.<\/p>\n

David:
All right. This is David Greene for Rob reverse CPR Abasolo, signing off.<\/p>\n

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