JF2350: The Art Of The Follow-up With Sterling White #SkillsetSunday

Sterling is a multifamily investor specializing in value-add apartments in Indianapolis and other Midwestern markets. With just over a decade of experience in the real estate industry, Sterling was involved with the management of over $10MM in capital, which is deployed across a $18.9MM real estate portfolio made up of multifamily apartments. Today, Sterling will be going into details about one of his most powerful sales tool, the follow-up.

Sterling White  Real Estate Background:  

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“The art of the followup separates the newbies from the pros” – Sterling White

TRANSCRIPTION

Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless. This is the world’s longest-running daily real estate investing podcast where we only talk about the best advice ever. We don’t get into any of that fluffy stuff. And – well, it’s Sunday. Because it’s Sunday, we’ve got a special segment for you called Skillset Sunday. And here’s the skill that you might not have, or if you have, then props to you, but I bet we can hone this skill. And this skill is the art of the follow-up. And who’s going to teach us his way of the art of the follow up, which has been successful for him and others he’s spoken to about it? Mr. Sterling White. Sterling, how are you doing my friend?

Sterling White: Alright. Welcome, everyone. Strap in your seat belts, bring your bags with you, because we’re going to be dropping tons of golden nuggets and bombs. So I definitely appreciate being on here again, Joe. It’s always great catching up with you.

Joe Fairless: And a little bit about Sterling, just as a refresher – he was on episode 1236, titled What To Do When A Deal Falls Through, Situation Saturday. You can go listen to that, episode 1236. Just a refresher real quick. He’s a full-time real estate investor and author of From Zero to 400 Units. He’s got over a decade worth of experience. His portfolio consists of –imagine this– 400 units. He’s based in Indianapolis, Indiana. So with that being said, we’re talking about the art of the follow-up. How should we begin the conversation to frame it the correct way?

Sterling White: Yeah. One thing I love – we’re in essence triple S, because it’s Skillset Sunday with Sterling. So I love trple S’es. [laughter] And I would say is this was by far the absolute game-changer for me with the follow-up, and for individuals to know that this is really what separates the newbies from the novice, the novice from the amateurs, amateurs from the pros, and absolute mastery is just this one segment in itself.

Joe Fairless: Well, I’m in. And before we started recording this, we were talking about a couple of different angles to take with this conversation… And you mentioned the art of the follow-up, and you mentioned that it’s a mindset approach, first and foremost, and then you get into the tactics. And I loved that. So can you talk about just how we should think about following up with people?

Sterling White: Yeah, I would say is… How I’ve shifted it — and this is more so on the acquisitions, or you can say in general we’re relating to acquisitions… It’s that even when you’re buying, you’re still selling. So it’s a sales process. And many of the times, let’s say you’re taking the direct to owner approach, or you’re touching base with a broker. Let’s say we’re taking the direct to owner approach, because that’s the path that I go. 95% to 99.9% of the time that owner is not interested when I first reach out. So first, it takes six to eight attempts just to get in contact with them, they’re not interested, and now it takes additional follow-ups to now catch them at the right timing… Because I really want to touch and follow-up, because I spoke with someone the other day, and they said, “I’m doing direct mail, it’s not working.” And I asked them, “How many times did you do it?” They said “Once, Joe.” One time.

Joe Fairless: And that’s not going to cut it when you’re introducing yourself to someone for the first time, right? You’ve got to have multiple ways of having them get to know you, and you get to know them.

Sterling White: Exactly. And also, on top of that, is I like to call it the value-based follow-up. So now I’m going to get into some tactics. So you can keep following up with an owner with the same approach, saying now you’re interested in selling, now you’re interested in selling your property. Or you can go the extra mile and – this is one I’ll use, I’ll send out random birthday cards. And on the birthday card, it says, “I may have caught you a little bit sooner, a little bit later, but just want to ensure I got you.” So there’s that.

And then also, I’ll reach out to them and say, “Hey, we’ve got local meetups here that are in Indianapolis and thought you would be a great speaker to share your story, considering you’ve had success in the industry.” So all these different ways – and this is one quote I like to use, it’s “Creativity follows commitment.” If you’re committed enough, you’ll be creative as a way to stay top of mind. Because if not, you follow with the same message, and they’ll say just put me on the Do Not Call List.

Joe Fairless: We might bounce a little back and forth on getting into the weeds and then talking more high-level, but I want to ask about one of the things you just mentioned… When you say to an owner, “Hey, I want to profile you. I want you to share your story at a meetup that I host”, how many owners have taken you up on that?

Sterling White: Zero. At this point in time, it’s been zero. And of course, I started implementing this right as COVID happened, so that also affected things… But why this comes into consideration? I’ve at least gotten some engagement from them. That’s the main thing. Of course, if they say “Yes, I’d be interested”, then I would set it up. But it’s more of those things that’s just to open up the relationship again. Because many times these individuals just go ghost, and I don’t hear from them again. And then that’s when I start to get creative as a way just to touch them. And then from there, they say, “Yeah, I’d be open to it.”

One of the owners I got in touch with, he said, “Well, I’m a little bit nervous, but I enjoy doing things that are out of my comfort zone.” And then we started a conversation from there. So it’s just really just staying top of mind. So one, building the relationship, and then also, it’s timing. This was one individual, it’s going on for about two and a half or three years now, of which I’ve been following up with that individual… And it’s just about timing; they’re still not ready to sell. And at that right moment in time when I follow-up – there we go. I’m the one that first comes to mind.

Joe Fairless: How many have you got engagement from with the random birthday cards?

Sterling White: It is very low. I would say the percentage in terms of sending out, I would say…

Joe Fairless: Just the total number of people, would you say.

Sterling White: Four to five.

Joe Fairless: Four to five?

Sterling White: Correct.

Joe Fairless: And these are multifamily owners?

Sterling White: Yeah, these are multifamily property owners. And I’ll send these out after I’ve had some conversation with them. It’s just not one of those just direct mail campaigns where they are not familiar with me at all.

Joe Fairless: Okay. I thought you were about to say “I’ll send them out these random birthday cards after I’ve had some drinks” or something like that. I was like “That makes sense. If you’re sending random ones, you might as well make a party of it as you write these out.” [laughter] The four to five that you’ve had an engagement with, what did they say?

Sterling White: It’s just more of “Hey, you got me a little bit too soon, but I do appreciate the card.”

Joe Fairless: [laughter] And what’s your follow up there?

Sterling White: The follow-up is, “I just want to ensure I got you covered, and yeah, anyway I could be of value to you…” So I’m re-engaging the conversation. And it’s also a pattern interrupt, too. You get a random birthday card, they’re like “What is this?!” And I know one guy that actually sends — and yes, this is going to be hilarious. He sends potatoes. Yes, potatoes. And he had one of his clients reach back out to him and said, “Did you send me a potato?” He’s like “Yeah, I sent you a potato. But now that I’ve got you on the phone now…”

Joe Fairless: Oh, gosh… Oh, man. Huh… When you get these leads, what system are you using to track the leads? And this person responded to the birthday card, this one responded to the share your story meetup…

Sterling White: So I have a CRM that I use. And for everyone who’s on here, ECRM is different. There are tons that are out there. I do a lot of outbound communication, so there’s one that’s Mojo Dialer that some people use. I use close.com, which is very simple for me to use because I like things to be super simple. And it’s more for individuals that are doing quite a bit of volume in terms of calls. So that’s what I use in terms of a CRM, and I keep everything tracked in there.

Joe Fairless: Got it. close.com, “Turn more leads into revenue.” I’m on their website. I haven’t heard of close.com. So close.com – is that your main CRM? You send out emails through that, you track your leads, you track engagement… Like a Salesforce type thing?

Sterling White: Yeah, it’s the same exact thing. I’m unsure if Salesforce you can actually make outbound calls. And one thing I’ve heard about Salesforce is it can get very clunky and very convoluted. So that’s why I ended up going with this. And yeah, you can track everything. I can have the KPI, so I can understand if we make this amount of calls, this is where the conversion rate to appointments is. And then we can reverse-engineer from that and say, “This is how many LOIs that we can get from this amount of appointments”. And then from those LOIs, this is the amount that converts to an actual contract.

Joe Fairless: But a lot of the stuff we’re talking about, or you’ve been talking about, aren’t phone calls, they’re mailing stuff out. So are you also doing cold calls?

Sterling White: Yeah, cold calls are my primary channel. The direct mail and those that I was mentioned to you are more of just a way to follow up.

Joe Fairless: Ah, yes.

Sterling White: And the thing with my list is — so I target apartments 75 to 200 units. So I’m in Indianapolis and other Midwestern markets, so it’s very niche. So a primary touchpoint is calls. And then also we even get creative on top of that, but in essence, we just use direct mails as a way just to keep following up, versus just using a text message, or a call, or an email.

Joe Fairless: Okay. So you use direct mail to keep following up. You said earlier that 99% of the time you call the owner the first time, they’re not interested. So it takes six to eight attempts to follow up with them.

Sterling White: Six to eight attempts just to get in contact with them.

Joe Fairless: To get in contact with them. For them to say “Hi, Sterling.” Or “Leave me alone, Sterling.” Or “I’m interested.”

Sterling White: “I’m not interested to sell my property.” Or “I would sell it for above market, or top dollar, or the right price”.

Joe Fairless: Right. Okay. Let’s talk about the other ways then you’re following up. One’s a random birthday card. Another is to share your story. You said it takes six to eight times. So what are the other things you’re doing?

Sterling White: Personal visit, by far my favorite one. It definitely takes some, for lack of a better word, big cojones when it comes to this, just dropping in on the owner completely cold. But if you’re committed enough, you’ll figure out a way, and this comes down to your why. I have big why’s and I’m willing to do things like that. So that’s one.

And then also, there’s another channel if I’ve had difficulties getting in touch with someone – one way I’ve done, this was 120 units here in Indianapolis, in which I had not very much success in terms of getting in touch with the owner… So what I did was I use a database such as beenverified.com. I’m not affiliated with them, I just use them. So I typed the owner’s first and last name in there, and then I ended up getting a relative, which was the daughter. So I reached out to the daughter on Facebook, strictly business, everyone that’s on here, and just asked “Hey, looking to get in touch with your father relating to this property”, and was able to get their number directly.

Joe Fairless: Wow. Did she asked how you got my info?

Sterling White: Sometimes you’ll get that, but not from that. She probably just saw I was very handsome and said [unintelligible [00:14:20].25]

Joe Fairless: Oh, man. [laughter] That’s an interesting approach because it connects you with the owner through a loved one. What a warm referral that is. The loved one might be saying, “This creepy guy randomly reached out to me, dad. I’m going to give you his info, but then you call the cops right after.” But either way, she’s still talking to her father about you. And assuming that he loves his daughter, there’s some to be said about that.

Sterling White: Yeah, and it’s all just… Gosh, where was I going to go with that? It’s just really the habit of going the extra mile –which is a principle from Napoleon Hill– is I feel in those cases such as this example, people hit these specific barriers when they’re looking to get in touch with an owner… Whether they’ve made these multiple follow-up attempts, they’re not properly getting through, they’re getting in touch with a gatekeeper, can’t get through to the gatekeeper to the direct decision-maker… By going the extra mile, I feel — because people stop at that, and then when you go above and beyond, that’s what really separates you from those. Because I closed on a deal where I’ve actually sent it over to the brokers and said, “Hey, could you help me out with this lead? Because I haven’t had much success?” And then many of them just said, “No, we haven’t had any contact with them.” I went the extra mile to do some more skip tracing, ended up finding one of the operators having a unique last name. They were in Florida, I said, “Well, let me just give this person a call. They’re in real estate.” It turns out they were one of the people who actually put the syndication together close to two decades ago, and then started the conversation. Fast-forward, we closed on it. The brokers reached out to me and said “How the heck? I had so much difficulty getting in touch with that person.”

Joe Fairless: That was 120 units?

Sterling White: That was 156 units.

Joe Fairless: That was 156.

Sterling White: That was another property.

Joe Fairless: The 120 units you got through the beenverified daughter and dad connection?

Sterling White: Yes, correct. I didn’t close on that. That was just one that ended up going the extra mile was  a way to being creative as a way to get in touch with the decision-maker. Because many people just say, “Ah, this property is not going to work. It’s too difficult. Let me move on to another one.”

Joe Fairless: Why didn’t that one work?

Sterling White: Their price. And I’ve shifted away from those. It’s built in the early 1970s, C-class property. It needs quite a bit of work. And I’ve shifted my model more towards 1980 to 2000 construction, with less deferred maintenance.

Joe Fairless: So the random birthday cards, meetups to share your story, personal visits…

Sterling White: Rubik’s cube, many people know me for this. This is by far one of my favorite ones outside of the personal visit, is a Rubik’s cube. I’ll send it to them, direct mail, with a small note that says “Hey, let’s figure this out.”

Joe Fairless: How many conversations has that resulted in?

Sterling White: I would say more so about 15 to 20. And there was one –because I follow up right after I send the Rubik’s cube– is the owner, I had him on the phone, and he said “My wife cannot figure out this damn Rubik’s cube. So she’s in the back, working on the Rubik’s cube, and he’s speaking to the guy who sent it to him. So all these different channels are just a way to just keep pinging the person to stay top of mind. So once they do the transition from not interested to being interested, you’re the one that comes top of mind.

Joe Fairless: And you’re able to track that in close.com, like, “Okay, sent them this Rubik’s Cube, I did a personal visit.” Do you track all that stuff? Or just the phone call results?

Sterling White: I track more so the phone call results. I do include in the notes the various touchpoints. But in terms of tracking, “Hey, this converted to this,” that is something to actually implement. But right now it’s more so just the calls.

Joe Fairless: Do you have a process that you follow, where you do it in a certain order, these things?

Sterling White: In terms of a certain order, is if I send a letter of intent out to someone before the actual contract and I don’t hear from them, that’s when I will send the Rubik’s cube. And then if I have gotten in touch with…

Joe Fairless: Oh, real quick. A letter of intent… I assume that means that you’ve got financials from them, or are you just writing it up based off of what you believe to be the financials?

Sterling White: I have gotten financials — that does vary. I have actually recently sent an LOI to an owner. What I did was I just normalized; so they were able to provide me the rent roll, I normalized the expenses, and then I submitted an LOI just as a way to follow up.

Joe Fairless: But at that point, if they’ve sent you the rent roll, you’ve already engaged them.

Sterling White: Yes, correct. This isn’t a blind Rubik’s cube. Is that what you’re–

Joe Fairless: Yeah. Okay. Noted. So the Rubik’s cube is in place after you’ve had some sort of engagement with them. But the other things, like skip tracing an owner – you clearly haven’t talked to them because you have to skip trace them. Beenverified, same thing. Personal visit, I imagine, that’s in the same category. Meetup, share your story, same thing. So with those in particular, do you have a certain order in which you follow up?

Sterling White: Yeah, the first channel will be the birthday card. That’s one. So the birthday card is the go-to in terms of the subset, but also in terms of like a process. Because some owners are at different stages. So we have this owner, I know that they’re in Indianapolis, I’ll do a personal visit. And then I’ll follow up with a personal handwritten letter from myself as a way, “Hey, it was good to meet you.” So in terms of like an actual process of the direct mail, primarily is the happy birthday card. But outside of that is — it’s not “Okay, we’re going to do this campaign, we’re going to do this campaign, and this campaign.” We do have occasions that we do a campaign on the go to all of the owners that have expressed interest, but in terms of a process.

Joe Fairless: What would that be? All the owners who have expressed interest,  what does that campaign look like?

Sterling White: The campaign will be something along the lines of a handwritten letter. So that’s one. And then also there’ll be – myself will send an email out to them that says, “Hey, going to be out in the neighborhood, would love to put my hand in your hand.” So that’s what we’ll do if after a month we haven’t had an engagement with a specific set of owners. We’ll say, “Hey, this is a campaign that we’re going to use on all 25 or 30 of these individuals.”

Joe Fairless: I love hearing about this. Anything that we haven’t talked about, that you think we should, as relates to the art of the follow-up?

Sterling White: I would just say for everyone, this is one thing I learned… Love him or hate him, hose of you are on here –  Grant Cardone… So I’ve gotten so much valuable information in terms of just the sales in itself… Because I’m a believer that sales is everything, and not just in business, but even in life. But through this, the follow-up is some people just don’t have realistic expectations. The majority of the time, people don’t even make the attempt, whether that’s direct mail, or cold call, or whatever channel they’re using. And then they quit after the second, third, or fourth time, not knowing that on average it takes between six to eight attempts just to get in contact with the person. That’s just the get in contact, give them your pitch, and them many a time they’re not even interested. And now it’s, even more, follow ups after that.

Joe Fairless: What are your thoughts about someone who sends the same (let’s just call it) postcard or brochure to that contact six to eight times? Good or bad?

Sterling White: You’ve got to be creative, because they are getting tons of other direct mail. So by someone doing that, it’s better than nothing. And the good thing is that they’re consistent. But if they’re able to switch it up of some sort… Because that yellow letter that they have that was handwritten that they’ve sent maybe two to three times, if they send a red one in a red envelope, that could be the one that hits and triggers that person, “Oh, I’m actually going to pick this one up and actually take a look and call this individual.”

Joe Fairless: How can the Best Ever listeners learn more about what you’re doing?

Sterling White: You can visit me on Instagram, @sterlingwhiteofficial, and also visit sonderinvestmentgroup.com. [unintelligible [00:22:33].11] here to be a value to everyone who’s on here. Just remember, keep being awesome.

Joe Fairless: I loved our conversation as always. I love the creativity that’s put into action. A lot of people have… No, I wouldn’t say a lot of people have a lot of creative ideas to move the business forward, because that’s a unique skill set, I believe… But not only do you have creative ideas to move the business forward, but you also execute on them and follow through [unintelligible [00:23:03].12] the follow-up, like we talked about. Breaking through the clutter and then executing on that on a consistent basis.

And also, as you said a couple of times, setting expectations with yourself and with your team, that it is going to take six to eight times just to get in contact with them. And we’re talking about owners in this circumstance, but I imagine that’s applied to others as well. Thanks for being on the show, Sterling, I enjoyed it. I hope you have a Best Ever weekend and talk to you again soon.

Sterling White: Oh, yeah. Have a great one, everyone.

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