In my conversation with Peter Vekselman, who completes 5 to 10 deals per week in 6 different markets, he provided the lessons that he learned from losing EVERYTHING and then gaining it all back. His secret was transitioning from a one-dimensional investing approach to a multi-dimensional, consulting business model.
Lessons From Losing Everything and Gaining It Back
Peter’s main lesson learned from losing everything is that real estate is a business of decision-making:
- Do I hire this guy or do I hire that guy?
- Do I offer this price or do I offer that price?
- Do I work with this realtor or do I work with that realtor?
- Do I invest in this neighborhood or do I invest in that neighborhood?
The mistake that created Peter’s early struggles was that he was making all of his decisions off the cuff. He didn’t have anyone to run his decisions by. He didn’t have a mentor. He didn’t have anyone that he could go to that was more successful than him. As a result, during his first 6 months, every single decision he made was incorrect. He bought in the wrong areas. He paid the wrong prices. He had the wrong contractors. He hired the wrong realtors. He worked with the wrong lenders. However, once he had made all the incorrect decisions, by default, he now had all the RIGHT answers moving forward.
You must have a basis understanding of what the correct decisions are before you haphazardly get into real estate investing. Peter is a huge proponent of getting out there and taking action. However, you need to have a prior level of expertise so that you don’t make the same mistakes that he did and end up having to start from scratch. We all get our education one way or another. Either by making the wrong choices and learning from our mistakes – which is the hard way – or by getting your education upfront and learning from the mistakes of others. Which method do you prefer? Ultimately, the choice is yours!
One-Dimensional to Multi-Dimensional Consulting Approach
After getting all of his early mistakes out of the way, Peter was able to develop a very efficient marketing program. He was consistently receiving 500 to 600 seller calls every day. However, the problem was that he had a one-dimensional, inefficient approach to negotiating the deals. All of the negotiating was occurring on the phone. With 600 sellers calling in every day, Peter didn’t have the resources to hire 600 reps to meet with 600 sellers in their living rooms face-to-face. On top of that, he was only offering the sellers one option; with that option being the Peter would personally purchase the property.
Now, Peter has transitioned to a multi-dimensional, consulting approach. First, instead of conducting negotiations on the phone, he began utilizing real estate agents that would go inside potential seller’s homes and meet with them face to face. Secondly, Peter began offering the sellers two options: (1) He will buy the property on the spot or (2) He will help them sell he property.
Going into negotiations and saying “I am the best and greatest real estate agent” doesn’t work. Sellers hear that all the time. Also, going in and saying “I am an investor and I want to buy your property for 50 cents on the dollar” doesn’t work. Sellers get scared and turned off by this approach. However, by going in with an all encompassing, consulting approach, saying “we know that we can help you. We have multiple options and you, Mr. Seller, are going to be in charge of those options,” has been a game changer for Peter’s business. His investment business tripled and his retail business, which was virtually nonexistent before, went through the roof. He attributes the entirety of this success to transitioning to the multi-dimensional, consulting approach.
With his new multi-dimensional, consulting approach, Peter has created a win-win scenario for himself and his agents, plus for the sellers.
- He is able to cherry pick the best deals, which he will rehab and sell for a profit.
- His investment business has tripled
- He gets to do what he loves, which is adding value to the lives of his employees and his customers
For His Real Estate Agents
- They have a continuous pipeline of prospective sellers to meet with face-to-face due to Peter’s marketing system
- They get paid regardless of which option the seller selects. If Peter decides to purchase the property, the agent receives a fix commission within one week. If they list the property for the seller, they receive the regular commission
For the Sellers
- The seller wants one thing – to sell the property. They have the ability to make that happen because Peter will either buy it himself or help them sell it
- Due to Peter’s consulting approach, the sellers get to meet with the agents face-to-face, instead of a faceless voice on the phone.
How can you add multiple dimensions to your current real estate business model and create a win-win scenario for yourself, you employees, and your customers?
Disclaimer: The views and opinions expressed in this blog post are provided for informational purposes only, and should not be construed as an offer to buy or sell any securities or to make or consider any investment or course of action.