Open Letter to Struggling Newbie Investors: How I Landed My 1st Wholesale Deal

August 9, 2017 in Investor Stories

As I sit and write this open letter to new investors, I am reminded of the struggles I faced. It was not long ago when I confronted a critical decision. I had to decide whether to throw caution to the wind and invest or continue down my current path. I would like write to you today about taking the leap of faith.

My Backstory

Let me give you the backstory of why I am qualified to write this letter to you. I moved 2,500 miles away to start over. I did not need to start over; I was satisfied where I was, but I felt there was more. I had recently graduated from graduate school and worked for the family business, but my passion was elsewhere. My passion is property, not people, and our family business was built on helping people. The business is great for them, but I wanted to find a way I could help people while incorporating real estate.

To graduate with an MBA, I had to write a business plan. The plan needed to be a minimum of 60 pages along with financials. I took this assignment to heart. I always loved real estate but was never was inspired to follow my dream, so I wrote the plan solely about starting a real estate company. This is the first point I would like to make: Do not let your decisions in life be contingent upon others or money. As I planned and wrote, I became inspired. My wife and I would visit her cousin in Phoenix often, and during these visits, I would notice the growth the region was having. There was nothing similar to this in the Midwest. From that point on, I decided I wanted to be a part of that growth.

Making the Jump

Since I’d written the business plan, I decided to actually take action on it. It’s funny how things happen—at this time, my wife and I decided that while our kids were young, we would move. Living in Chicagoland all our lives, we both wanted to venture out. We decided we wanted to be south of the Mason-Dixon line. We narrowed it down to three states—Florida, Texas, and Arizona, eventually deciding on Arizona. I could now work to execute my plan. Honestly, it was a joint decision between my wife and me; in fact, I was more scared than she was. After much prayer and deliberation, we decided to make our way.

The Struggle

I knew things were not going to be easy, but I had no idea what I was up against. My wife was positioned well, but I faced challenges at every turn. I’ve always had an entrepreneurial spirit, and coming from my family’s business Chicago, I’d never had to face someone telling me what time to come to work and what I could and could not do. At 36 years old, I was not about to start. I was a critical piece in building a million-dollar non-profit, and I knew I could build an amazing real estate business.

I did try and work for someone else first, but that did not go very well. I was an entrepreneur, and all my credentials and background showed that I either worked for myself or for family. So, you guessed it, finding a job was not easy, but I did land two opportunities.

First Opportunity

The first opportunity was a job working with the Arizona Department of Public Safety. My background was in human resources, and they needed an HR position filed. Although I hated human resources, I had performed this job for my family, but doing this for the State of Arizona was not exactly in my business plan.

Still, I have a family of five, and we had just moved across the country. I needed the money, so I applied. I aced the test, impressed the interview panel, and was offered the job on the spot. Passing the polygraph and background test was all I needed to do. The polygraph test was a cinch, but I ran into problems with the background test. I did a few stupid things during my college days. (I did go to the school that was the highest ranking party school in the ’90s, so I did not make it out squeaky clean, similar to many others I know.) After the background test, the job offer was rescinded.

Second Opportunity

Eventually, I got a job with the Arizona Department of Child Safety. Working with people and kids was not exactly what I wanted to do, but it would make ends meet. Guess what? I worked there for two months and was fired because the same background check hit from college came up again. I thought this was crazy—I worked in Illinois with kids and families daily, my background check there came back clean. What was the problem? I became very fearful after that. Had I moved my family 2,500 miles away, only to not be able to find a job?

Final Opportunity

After being let go, I took a long ride on my Harley and thought about what was next. With all our credit cards maxed out and our savings dwindling fast, I thought back on what my purpose was for moving to Arizona. Then it hit me: Revisit your business plan and get to work. Follow your dream.

I reviewed many entry level ideas on how to get into the real estate industry. I knew I was a hard worker and a vision builder; I just needed to meet the right people. I put it all on the line, took my last $350, and registered for an intro to real estate investing at AZREIA (Arizona Real Estate Investors Association). I was familiar with wholesaling through the many BiggerPockets podcasts I had listened to, but now I was looking to meet people actually doing it. The class was inspiring, and I met a lot of wonderful people, but no one could steer me in the right direction.

My First Deals

What did I know how to do? I could get started driving for dollars, sending direct mail, and talking with sellers, so I focused on those. I got my tax returns, and I invested money in a small campaign. I wrote out 25 letters a day to absentee owners, and after two weeks, I had a hot lead. To make a long story short, I contracted the house for too much, and it was a failure. Still, I now had some experience working through the process. Because of that experience, I had a title company to work with.

Next, I went to guru workshop, and I met some high level wholesalers and connected with them. One wholesaler I was doing nothing but putting out offers on MLS properties and going to open houses to meet real estate agents. Then, finally, I had an offer accepted and made $2,200. I made another $4,500 from there—and it’s been on ever since.

Persist to Success

In this open letter, I want newbies to notice that I had to make a decision that challenged everything I knew. Then I had to fight adversity with faith. Finally, persistence paid off. Nothing is going to be easy when you’re starting something completely knew. The biggest challenges were not the exterior forces but the emotions within. My mind was telling me I couldn’t do it, and my thoughts were negative. Once I turned those thoughts to positive goals and fought, I succeeded.

Do you have any stories of challenges getting started? Is there anything you need answered or are trying to figure out?