Matt has 14 years of real estate investing experience and is the Owner of Real Estate Matt Education and Easy Street Property Investments. Matt shares some of the reasons why he has been able to double his business year by year for almost a decade.
Matt Larson Real Estate Background:
- Owner of Real Estate Matt Education and Easy Street Property Investments
- Full-time real estate investor with 14 years of experience
- His team has completed over 4000 real estate transactions
- Currently renovates 35 homes per month, and manages 1400 units
- Based in Davenport, Iowa
- Say hi at www.realestatematt.com
- Best Ever Book: How I Raised Myself from Failure to Success in Selling
Click here for more info on groundbreaker.co
Best Ever Tweet:
“We are very process-oriented.” – Matt Larson
Theo Hicks: Hello, Best Ever listeners. Welcome to the best real estate investing advice ever show. I’m Theo Hicks, today’s host and today, I’ll be speaking with Matt Larson. Matt, how you doing today?
Matt Larson: I’m doing great. Thanks for having me.
Theo Hicks: Yeah, absolutely. Thanks for joining us. Looking forward to our conversation. A little bit about Matt – he is the owner of RealEstateMatt Education and Easy Street Property Investments, he’s been a full-time real estate investor for 14 years, his team has completed over 4,000 real estate transactions, currently renovates 35 homes per month and manages 1,400 units, based in Davenport, Iowa, and you can say hi to him at realestatematt.com. Matt, before we get any further, do you mind telling us a little bit about your background and what you’re focused on today?
Matt Larson: Yeah, absolutely. So I grew up in a small town in Illinois; I literally got out of high school, didn’t really know which direction I was going to go, tried college for a very short period of time, ended up making it to the college route. I went back home to my small town where I’m from and worked in a machine shop, and I just did that from 19 to about 30 years old, a little over 30, and then at 30, I got into real estate. I read a book on real estate, and this was in 2005 at this point. I started my real estate career in 2005 at the peak of the market, and started there and did a ton of deals when ’08, ’09 hit; I really went full time at that point and just did several hundred deals in a very short amount of time and just have taken that momentum all the way through until where we’re at today.
Theo Hicks: Perfect. So thanks for sharing that. So you’ve done over 4,000 transactions, you renovate 35 homes per month and you manage 1,400 units. So is your business plan buying, renovating and then renting these out?
Matt Larson: Yeah, I do a little bit of everything and have for years, but I do some wholesaling, I do some retail fix and flips on occasion, but ultimately, I use all of the wholesaling income and flipping income to buy rental properties, and I own several hundred rental properties in my own portfolio, and then we also sell turnkey as well. So anything that I sell, I continue to manage, which is why we have our own management company, but the real end goal is just monthly cash flow and ongoing income without having to continue to do the work. But I’ve got a very automated system – we have about 40 people in my office because of the volume we’re doing. So the company runs without me. I do less than five hours a week in the real estate company. I use a lot of virtual assistants. I built my staff out in order to meet for me. So my role in the company now is I just look at the high-level KPIs and I let the company run.
Theo Hicks: I definitely wanna dive into how you’re able to run a massive company by spending 10 hours per week, but first I want to just dive a bit more into the business plan. So what type of rental properties – are they single-family homes, duplexes, apartments or is it all over the place?
Matt Larson: It’s a little bit all over the place. Primarily, it’s single-family homes, but we do a lot of duplexes, triplexes and fourplexes; that’s probably 90% of the business, and then the other 10%, I do some bigger apartment complexes on occasion and some commercial real estate, but that’s really a very small portion of what it is that I do. Primarily, single-family homes, duplexes, triplexes and fourplexes.
Theo Hicks: So you’re doing about 35 deals per month, correct?
Matt Larson: Correct.
Theo Hicks: So what does your funnel look like? So I guess, at the bottom – it’s like, we do 35 deals; so how many deals coming in, how many deals are you underwriting, how many deals are you offering on and then obviously you are closing on 35?
Matt Larson: Typically, my marketing is 5,000 direct mail pieces a week, plus another 3,000 cold calls a week, and then we also do another 2,000 to 4,000 text messages a week, plus all my natural marketing that we do. I have 15 to 20 company vehicles that are wrapped in my We Buy Houses and company name are always on the street at all time; 15 to 20 of those on the street. I also bought my own dumpsters about a year ago. So we have all of our dumpsters in front of the property say We Buy Houses, so that generates leads as well. But that’s the front end marketing; that brings in hundreds of leads every single week, and then from there, my lead manager and her virtual assistant that works for her, they sort out those leads, get rid of any leads that just don’t make sense, and then take those leads and discover what that property is worth and what our offer would be, then that offer goes to my acquisitions guy, and then he then calls the homeowner and makes the offer and goes and looks at the property if they’re somewhere in the ballpark. So we talk to a lot of sellers in order to get to that five to ten houses every single week.
Theo Hicks: You said 5,000 direct mailers per week, right?
Matt Larson: Correct, yep.
Theo Hicks: Okay, so you got 3,000 cold calls, 5,000 direct mail, 4,000ish text messages, how?
Matt Larson: Well, I got a big team. So again, I have about 40 people that work for me between my investing side, project management and property management. So we’ve just got a very finely tuned machine. I’ve been doing this 14 years, closed over 4000 deals.
So one thing that we’ve done that probably sets us apart is we’re very process-oriented. We literally figure out the best route to get a process done and we document that process very detailed – every single step, every word that we speak, every single step to get the process done, and then we hand off that process to a virtual assistant in a lot of cases. We have seven virtual assistants that work for us along the whole process of everything that is what we do. So it might sound like a lot, but it’s really not that labor-intensive if you’ve got a really good system that’s dialed in, step by step process… And then we run everything through Podio. In my particular Podio system, which I think is one of the keys to my business, I’ve got over $100,000 invested in the customization of my Podio program. Everything speaks to each other; we literally run the entire company in Podio, from project management to maintenance to acquisitions to dispositions and everything in between, and I have an 18,000 square foot warehouse that I build a mini Lowe’s in. So we buy product at about 80% below what a Lowe’s or Home Depot price would be for the average person walking in off the street, and that communicates through Podio as well. So we’re very, very streamlined, very process-driven, and that helps us do the volume that we do.
Theo Hicks: That warehouse is for when you manage properties like maintenance and renovations and stuff?
Matt Larson: Yeah, it’s only for us. We don’t sell out of there. We don’t offer any of that stuff for sale. It’s just our own use, mostly for renovations, and then the maintenance company uses those materials as well.
Theo Hicks: I’m sure this is an impossible question to answer, so maybe give us a general ballpark… So you started 14 years ago, you’re doing about 35 homes per month. Was it something that every year the business doubled, or was it one year just a massive increase? I just want to wrap my head around year over year from start to now, what the business looked like. Maybe three years, maybe. I don’t know. Every year is probably aggressive.
Matt Larson: It’s a great question. So in year one, I did 12 deals, year two, I did 10 deals, by the end of year three, I had about 35 deals done. I was still working a job at that time, 2008 hit, I leave my job, I go full time into real estate, and I start hiring people early on. So when my business really doubled — in ’08 to ’09, I did 52 deals. 2010 hit, we had some serious momentum from the foreclosure crisis that was going on, and then by 2012, I had started building my staff. I had a personal assistant; that very next year, my income doubled, the number of deal flow doubled from when I hired my first personal assistant; added a bookkeeper, added a project manager, and then from there, I would say every year it doubled – 2010, 2011 doubled, 2012 doubled, 2013 doubled, and then from there, it’s tapered off. But by 2013, 2014, I was doing 20 to 25 deals every single month. So we’ve been at that 20 plus deals a month for almost a decade.
Theo Hicks: Thanks for sharing that. You know exactly how many deals you’ve done every year, I like it.
Matt Larson: Yeah.
Theo Hicks: And you have a process-oriented mind as well.
Matt Larson: Yep.
Theo Hicks: So going back to the 10 hours per week, I know that you’ve already mentioned [unintelligible [00:11:56].03] all the processes, but for someone who is maybe just starting out or has a couple of properties and they’re at the point where they’re doing, maybe not 35 deals per month, maybe 35 deals per year, maybe 10 deals per year, but they only want to work a few hours per week. What are the one or two main things that they should start doing right away?
Matt Larson: This is a great question, and I hope everybody really listens to this; this will set you apart. So first thing you do is everybody’s good at something and everybody’s terrible at something, and you want to focus all your time doing the things that you love to do or that you’re amazing at.
So there’s some parts of the business that you just do because it’s out of necessity, it needs to be done, but you’re not good at it, you’re not efficient at it, you don’t enjoy it, you’re miserable doing it. What you do is take out a piece of paper, draw a line directly down the center of the paper, and on the left side, write down every single thing that you do in the business, and you can do this day to day; you don’t have to sit down and do it all at once. Just carry a piece of paper with you, go about your day and every time you get to something that you don’t like or you’re not good at, write that down on the left side of the piece of paper. And then do that for a week, you’ll have that side filled.
And then the right side, you write down everything that you’re amazing at or that you love to do, and over the course of a week, you’ll have that side filled. Then the left side of the paper becomes your interview sheet for your first– I like virtual assistants, I’m very big on virtual assistants. You can do this business virtually; you can run the whole company virtually. Again, we’re all quarantined right now and it’s shelter in place, but it didn’t change my business at all. I haven’t been in the office since October of last year anyway. So you have this left side, you need to create that as your interview sheet and start outsourcing that work to a virtual assistant, somebody that you can go to upwork.com, interview and hire somebody for $3 to $6 an hour, and that work will save you about 25 to 30 hours a week.
So imagine getting up and having an extra 25 to 30 hours a week that now you can go spend the stuff on the right side of the piece of paper, the stuff you’re good at and you love to do. Now imagine if you were spending an extra 30 hours a week on that stuff, your income is going to drastically improve… But at the same time, your happiness level will too, because you’re not going to be doing the things that you hate to do or that don’t pay you well, that you’re not good at, all that stuff. That’s what I would do; that’s day one. The cool thing about virtual assistants is you can hire somebody for 10 hours a week or 20 hours a week or whatever it is. You don’t have to keep them busy full time in the beginning.
Theo Hicks: That’s solid advice. I hope I didn’t jump the gun and get your best ever advice. I’m gonna just jump on that right now and maybe get your second piece of advice. So Matt, what is your best real estate investing advice ever?
Matt Larson: Again, because I’m very process-driven – discretion is the enemy of duplication. So anytime you leave discretion up to anybody or yourself, it’s never going to build a repeatable process, but one of the things you should do is every single process in your company, you should document step by step. Here’s what I do first, here’s what I say, here’s what I do second, here’s the script that goes with that… And every single thing in the whole business can then be transferred to anybody that you eventually hand that off to. It’s the way to build a system and a process to help you exit the company if you ever decide that you want to keep the company going, but you don’t want to do the day to day stuff.
Theo Hicks: Alright, Matt, you ready for the Best Ever lightning round?
Matt Larson: Let’s do it.
Theo Hicks: Okay. First, a quick word from our sponsor.
Break [00:15:22]:05] to [00:16:13]:03]
Theo Hicks: Okay Matt, what is the best ever book you’ve recently read?
Matt Larson: Well, one book that I’ve read multiple times that I absolutely love that I recently just read was a book that was written about 100 years ago. It’s called How I Raised Myself From Failure to Success in Selling. It’s an amazing book on sales; very easy to read, very good everyday advice, even 100 years later now.
Theo Hicks: If your business were to collapse today, what would you do next?
Matt Larson: If my business would collapse today, I’d start over again, I’d hire a virtual assistant and I’d be back to where I am now within two years.
Theo Hicks: Besides your first deal and your last deal, what’s the best ever deal you’ve done?
Matt Larson: I did a commercial deal once where I bought a Buffalo Wild Wings and bought it and flipped it and made 700k.
Theo Hicks: Wow. What about, on the flip side, what’s the deal you lost the most money on and how much did you lose and then what lessons did you learn?
Matt Larson: Oh man, a few years ago, I bought a duplex, totally underestimated the renovation, and by the time I sold this thing, I lost $60,000. So I wasn’t being detailed enough on the renovation and that one deal helped us refine our whole renovation process and systems.
Theo Hicks: What is the best ever way you like to give back?
Matt Larson: There’s a local business called 180. It’s an amazing company, it’s a nonprofit charity, and they take people that are getting out of jail or addiction or prison, and they put them up in their own housing that they’ve bought– and it’s almost like a halfway type house, but their graduation rate and their success rate’s like 99%. So I donate a ton of money to that group. It’s an amazing group and they’ve done a lot of cool things for our community.
Theo Hicks: Then lastly, what is the best ever place to reach you?
Matt Larson: The best ever place to reach me is Instagram, and that is @realestatematt, and I do answer anybody that messages me. It’s really me; because all my business runs on autopilot, I do spend some time on Instagram helping people. So if you’re following me, see some cool stories, I’m always teaching stuff, but Instagram is the best place @realestatematt.
Theo Hicks: Alright, Matt. Well, thanks for joining us today; very powerful interview. I think people are gonna get a lot from this, especially those who want to reduce the amount of time they’re spending in their business. You definitely offered a lot of solid advice on that.
I think the two biggest takeaways I got was that right side, left side piece of paper; very practical, something everyone can do right after this episode is over. So just summarize, take a piece of paper, put a line in the middle, everything you like doing or good at in the business is on the left side; everything you don’t like doing or not good at or the right side. You can know do it at your desk or a running document that you create during your week. So you can say, “Okay, during the week, these are all the things I’ve done; I like doing these, I don’t like doing these,” and then on the left side, which has things you don’t like, that’s your interview sheet; those are the jobs you want to outsource first to a virtual assistant. That’ll save you a lot of time, and you can use that time to work on the things that are on the right side, which are things you love.
The second big takeaway was the importance of process. So you said discretion is the enemy of duplication. So you want to make sure that you’re documenting step by step very specifically, every single step in a process. You gave us an example of how you’re doing 45 deals per month. You’ve got your cold calls, your direct mail, your text messages, and so I’m sure for all those, you’ve got a document that says specifically what to say in the cold call, different responses that you usually get and how to respond to those, what to do for direct mailers, different text messages. So I think if people who do those two things, it will definitely reduce the amount of time that they’re working in their business. So definitely take advantage of that advice, everyone. Matt, thanks again for joining us. Best Ever listeners, as always, thanks for listening. Have a best ever day and we will talk to you tomorrow.
Matt Larson: Thank you.
This website, including the podcasts and other content herein, are made available by Joesta PF LLC solely for informational purposes. The information, statements, comments, views and opinions expressed in this website do not constitute 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. Neither Joe Fairless nor Joesta PF LLC are providing or undertaking to provide any financial, economic, legal, accounting, tax or other advice in or by virtue of this website. The information, statements, comments, views and opinions provided in this website are general in nature, and such information, statements, comments, views and opinions are not intended to be and should not be construed as the provision of investment advice by Joe Fairless or Joesta PF LLC to that listener or generally, and do not result in any listener being considered a client or customer of Joe Fairless or Joesta PF LLC.
The information, statements, comments, views, and opinions expressed or provided in this website (including by speakers who are not officers, employees, or agents of Joe Fairless or Joesta PF LLC) are not necessarily those of Joe Fairless or Joesta PF LLC, and may not be current. Neither Joe Fairless nor Joesta PF LLC make any representation or warranty as to the accuracy or completeness of any of the information, statements, comments, views or opinions contained in this website, and any liability therefor (including in respect of direct, indirect or consequential loss or damage of any kind whatsoever) is expressly disclaimed. Neither Joe Fairless nor Joesta PF LLC undertake any obligation whatsoever to provide any form of update, amendment, change or correction to any of the information, statements, comments, views or opinions set forth in this podcast.
No part of this podcast may, without Joesta PF LLC’s prior written consent, be reproduced, redistributed, published, copied or duplicated in any form, by any means.
Joe Fairless serves as director of investor relations with Ashcroft Capital, a real estate investment firm. Ashcroft Capital is not affiliated with Joesta PF LLC or this website, and is not responsible for any of the content herein.
The views and opinions expressed in this podcast 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. For more information, go to www.bestevershow.com.