JF1018: A Tale of a Turtle and a Life Changing Daily Routine #FollowAlongFriday
A tale of a turtle, yes you read that correctly, a turtle. Joe shares a story of a recent event that instilled a paradigm shift, Theo shares a daily routine that is life-changing, and other updates!
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Joe Fairless: Best Ever listeners, how are you doing? Welcome to the best real estate investing advice ever show. I’m Joe Fairless, I am with our co-host for Follow Along Fridays, Theo Hicks. Hello!
Theo Hicks: How’s it going, Joe?
Joe Fairless: It’s going well. Today we’ve got an assortment of different things to talk about, so how should we kick it off?
Theo Hicks: We’re gonna kick it off with you story that involves turtles.
Joe Fairless: Yes, the turtle story. So for Follow Along Friday we talk about experiences that we’ve had over the previous week that are applicable to us as real estate investors and entrepreneurs, and there is a story about a turtle that is applicable that I want to quickly tell.
Last Friday I am driving and I’m on a two-lane country road, and then all of a sudden there’s a truck that stopped ahead of me, so I slow down… Right before that, the truck in front of me had to swerve to miss a turtle in the middle of our lane. The truck had to swerve in front of me, then I had to swerve, and we both missed it, thankfully.
Then all of a sudden this truck stops. I’m like, “Well, what are we doing?” He stops about 25-30 yards after we swerved to miss the turtle, and just coincidentally he happened to stop where these people were doing road work. I thought this guy is being flagged by the construction workers, because we have to stop.
Then I look behind me and there’s about 6-7 cars behind me as well… So this truck in front of me stops in the middle of the road. The guy gets out, he’s on his phone, so I think he’s with the construction crew. He walks past my car and he walks 25-50 yards back, and I’m like “What is he doing? I’ve got places to go, people to see…” Then as he’s walking back towards his truck, he’s got the turtle in his hand.
My initial reaction was – I said this out loud in my car – “Are you serious? All for a f****n turtle?” [laughter] That’s what I said… And I had a moment of realization. I was like, “Wait a second… Catch yourself, Joe.” He just saved an animal’s life, and it took maybe two minutes out of my day to do that. And by the way, I was driving to a hospice facility to go volunteer, to go hang out with a hospice patient that I see every Friday. So I’m thinking, “That’s his way of contributing in this moment.”
The takeaway I got from it was 1) careful about initially judging people’s actions and what they’re up to. 2) We all contribute in different ways towards society, whether it’s saving a turtle of whether it’s doing something else. It’s important to take that into account as we go through the day, and perhaps not initially judge people for actions that they’re doing that at the time I immediately think “Oh, man, what are you doing?! You’re in my way”, but instead, having a little bit more self-reflection.
My initial reaction was — I wrote it down, I was like “Oh my god, are you serious? All for a f****n turtle?” But then I was like, “Wait a second… Let me take a step back”, and then I appreciated what he was doing.
Theo Hicks: That’s a good anecdote, and it also reminds me of a play off of something that Ben Franklin — if you look at his routine, his routine was pretty crazy. It was a daily routine, and part of the routine, at the morning and at night he asked and answered one question. At night he says, “What good did I do today?” and kind of a play off of that would be “How did I help or contribute today?” With that guy it could have been the turtle, but I kind of look at it… You do a podcast and you’re always putting out all this information, but maybe not every single person who’s an investor wants to create a podcast. And just because they’re not adding value by having a podcast or writing blogs doesn’t mean he can do nothing. Just probably sharing a podcast with someone could be just as valuable to someone as actually creating it, or sharing a post, or writing a review on someone’s book is a great way to add value as well. That’s something that I tried to incorporate into my nightly routine, which is “Who or how did I contribute or help today?” instead of always focusing on consuming content.
Joe Fairless: I like that a lot, “What did I contribute today?” That can be a game-changing question. It’s similar to “What did I learn today?” They’re cousins, they’re not directly related. I think asking maybe those two questions – maybe I’ll start doing this, ask those two questions every day… “How did I contribute today to others?” and “What did I learn today?” because when you’re learning, you’re contributing to yourself and you’re improving, so you’ve got both bases covered – other people and yourself.
Theo Hicks: Yeah. And I think it’s important… This is why you journal, to know what you’re actually doing. Because if you’re not doing something, then you’ll know. But if you’re doing something, then you’ll kind of like — I won’t say reward yourself, but at least pat yourself on the back and be like “I actually accomplished something today.”
If you don’t ever write anything down or never ask yourself questions, then who knows what you’re doing?
Joe Fairless: Yeah. You mentioned the journal thing and I’ve mentioned it before, but just as a seven-second recap, I do a daily journal. It’s in a Word document, every single day. It’s a date, a bullet point, and then that’s it. It’s pretty cool to see what you’ve done over the past now. 28th June 2015 was the very first day I did it, and I’ve been doing it since then.
Theo Hicks: Moving on… Something else you wanna start doing on here is talking about any mistakes we’ve made in the past week and what we did to fix them, so that if the Best Ever listeners came across the same mistake, they can learn from ours. Do you wanna do yours first?
Joe Fairless: Yeah, and the reason why this is coming up is because I was on a call with a listener who was applying to be in my consulting multifamily program, and he said that everything I do turns to gold, and that he knows that I don’t make big mistakes… I’m like, “Where the hell did you get that from?” I said I guess I need to put more emphasis on my mistakes, because man, I’m making them every single day, and I’m making big ones every week, and even larger ones every year.
I think it will be important to give some perspective and context for the good stuff that’s going on in the business, but then also sprinkling in on a consistent basis what mistakes I’m making, and you’ve got mistakes too that we’re gonna share.
The mistake of the week for me is the Tony Robbins — sorry, Tony Hawk video…
Theo Hicks: You’re future-pacing there… You’re maybe gonna see him soon!
Joe Fairless: Yeah, exactly… We are in talks with Tony Robbins – with one of his publicists – to be on the show. The Tony Hawk interview…
Theo Hicks: I think it went live yesterday, on Wednesday of this week.
Joe Fairless: Wednesday of this week, yeah. It went live this week. I basically interviewed Emmitt Smith – I thought that was a great interview. One piece of feedback I got from someone was it was all roses and sunshine and ponies and pigtails… Perhaps ask about “What’s a flop that you had?” and I had that in my questions, but I didn’t ask. I should have. So moving forward, I will make sure I ask that to these high profile people who I’m interviewing.
So I think that went well though overall, but Tony Hawk I thought I was too prepared for, and I actually had too many prepared questions that I wanted to ask him, and I did too much research. I didn’t think that interview flowed well, and it was not his fault, it was my fault. I will also say that my calendar got really packed that day, as it usually does, and one of the things I did – and I never do this – is that I met with an investor at a bar right around the corner… I rode my bike to the bar, I had a beer (I had a Miller light), and I rode my bike back home to my office where I record the podcast. So I had one beer in me as well. I’m not a lightweight, I can handle more than one beer, but at the same time, I don’t know if that influenced my direction at all.
I just didn’t feel like I did a good job, and the reason why was I was over-prepared. So the lesson is that sometimes what you’ve been doing and how you’ve been preparing for future people is the same way you should prepare for someone else. I guess that’s interview-specific, and we’ll make it more broad… Trust your instincts; have the baseline knowledge that you need, but then trust your instincts. I guess that’s what it boils down to.
That goes with people, when you’re interviewing team members – have a process that you know works, but then ultimately go with your gut and common sense, versus trying to force-fit a process into something… Because ultimately, when you do that it’s a mechanical object versus a fluid dynamic piece of art that you’re wanting to do. So that can be applied on when you look at deals and interview team members etc.
Theo Hicks: I took that Dale Carnegie public speaking course – it’s called the Dale Carnegie Course, but there was a lot about communicating, and one of the rules that they had was never script out a speech, never have exactly what you’re gonna say and memorize it, because then while you’re giving your speech you’re just gonna be in your mind, thinking “Okay, what’s the next thing I’m going to say?” It seems kind of like what you’re saying, too… You were very rehearsed and you had all the questions prepared beforehand, and you weren’t able to go off-script a little bit. That was a big piece of advice that I learned from Dale Carnegie, because before I always thought, “Oh, you just script everything. Be very structured, so you don’t mess up or it doesn’t go off course”, but in reality, especially in an interview format, that’s kind of what you wanna have happen, because if you ask a question here and then you jump to something completely random, you might have been able to get something else out of that.
When I actually listened to your interview, I thought it was very cool, some of the questions you asked and how you asked him about the 900 spin [unintelligible [00:12:41].06] He knew that, but then he also knew that he talked about that and said that it was more mental than physical, so you kind of built off of that. I thought that was really cool. [unintelligible [00:12:50].13] like “Oh wow, this guy was prepared.” So you over-prepared this time, but I think it still has the positive, showing that you came into this ready to ask a bunch of questions that no one else would have asked.
Joe Fairless: Yeah, I appreciate it. I think the questions were good, but I didn’t do a good job of — once I asked a question, being in tune with the conversation enough where I could then follow up and dig a little bit into what his responses were. It was more surface level; I had prepared questions, he answered them and then I moved on to the next one. That’s the stuff that I need to bring to the table that’s better, so there you go. So what’s your mistake?
Theo Hicks: Well, before my mistake, something else that you were saying — you were talking about mistakes and someone asked you “Joe, you don’t ever make any mistakes, it’s crazy…” I think it was show 991, and it was about how to be a guru – that’s what the episode was titled. Essentially, the person was saying how anyone who has any experience as a real estate investor could be a “guru”, but the type of guru she was talking about was someone that literally uses their mistakes and monetizes them.
So what they’ll do is they’ll have a consulting program, or give talks, or do whatever, where they focus on the mistakes that they made and talk about “This is the problem, this is the issue that I ran into. You’re gonna run into this issue, too. Here’s how I overcame it”, and that’s really all you do. I thought that was interesting, because she was also talking about how the gurus that people may not necessarily – I wouldn’t say not like, but don’t get as much value from are the ones that always talk about the good and never talk about the bad, which is why I think it’s good that we’re gonna be talking about mistakes on Follow Along Friday, but also for your podcast, that in every single podcast you ask “What’s your biggest mistake?” and they always go into some sort of mistake that they made, so people know that everything is not gonna go smoothly in real estate.
Joe Fairless: Henceforth we will have a mistake that each of us has made the previous week… And it’s not about mentioning this — I talked to Theo about this before this how; it’s not about just mentioning a mistake, it’s about, as you just said, what have we learned from it and how can that be applied for every listener who could come across that similar situation?
Theo Hicks: Yeah. So my mistake is very specific, it’s not as broad as yours was. I’m currently under contract for three four-unit properties, so 12 units total, and I was doing the inspections last week. We walked through every single unit, and some of the tenants were home, some weren’t. For the tenants that were home…
Joe Fairless: You call them tenants or residents?
Theo Hicks: I call them residents now… [laughter] They were home, and they asked me who I was, and I said I was the owner, and I plan on buying the properties.
Joe Fairless: Because it felt good at the time. You’re like, “Yeah! I’m the one buying these properties.”
Theo Hicks: Yeah, exactly. It did feel pretty good…
Joe Fairless: You got a little ego boost…
Theo Hicks: Yeah. I did that, and one of the residents instantly went into this story about their lives. This guy was like, “I live in this apartment… I’ve been living here for this many years. The reason I moved here is because my last apartment burned down and I had all this custom German furniture and that all was gone. Now I don’t need anything; I just sleep on my couch, and I have a picture of my wife up there… She died 20 years ago and I can’t wait to see her again. I’ve got cancer”, and all this stuff. I was sympathetic with him a lot, but I walked away and I remember I looked at Marcella and I was like “I guess we can’t kick this guy out, we can’t raise his rent… We can’t do anything here because we’re so emotionally attached to this guy now.”
So the takeaway that I got, without trying to sound too cold, because again, at the end of the day it is an investment, but I also wanna take care of the residents, and we’re not gonna raise this guy’s rent… But at the end of the day I realized that when I’m visiting these properties moving forward, I’m not gonna tell them that I’m the actual owner of the property. I’m gonna say I work for the management company or I’m someone else and I report to the owner.
Intuitively, that makes a lot more sense because they’re not gonna tell a sob story to the property manager, because he doesn’t really have any control. Or if they do, I’m gonna say I’m the manager, I don’t have control of it. But also, I feel as if they’re going to communicate with you differently if they know you own the property, versus just some random guy that manages it.
Joe Fairless: And if you are buying it with your — girlfriend is not as strong of a word as we need, but you and Marcella are together… You are basically reporting to her. [laughter]
Theo Hicks: There you go, perfect!
Joe Fairless: You do report to the owner… [laughs]
Theo Hicks: So I’m not lying.
Joe Fairless: You’re not lying, exactly. And applying this for other aspects… From a negotiation standpoint, when you find yourself in a negotiation it’s always better to say “Well, I don’t have the authority, but I can talk to someone who does.” That way — for the most part. There’s exceptions, but for the most part it’s good, because then you don’t feel pressured to agree to whatever they’re asking for at that moment, and then you can go back and renegotiate.
I remember when I was in advertising and trying to get a higher salary, I was talking to the CFO of the company and he was like “Well, I don’t have the control…” I’m thinking, “Come on, man… Yeah, you do! You’re the CFO!” [laughs] But that’s just something that can help.
Similarly, the property manager could say the same thing – “I don’t control XYZ. I could talk to the owner” and you have to report in to Marcella, so it kind of works out.
Theo Hicks: I think as an investor you understand that the property manager maybe has some control, but the residents – once they hear that, they realize you’re not the owner, I think this defuses the situation and they’re not gonna ask you certain questions or demand certain things based off of that.
So that’s two mistakes you guys got for today to learn from.
Joe Fairless: Cool.
Theo Hicks: Something else we wanna talk about is [unintelligible [00:18:15].29] and there was an interesting survey that we wanna talk about; I’m gonna take this week in order to talk about the results. Do you wanna talk about the survey, or do you want me to explain it?
Joe Fairless: Sure. It is in Perry Marshall’s book called 80/20 Sales and Marketing. You know the premise, right? 80% of the results come from 20% of your actions, and it’s identifying what is that 20% so that you can maximize the results.
It’s a principle that’s been tried and true for a long time, and he wrote a book on this. I actually had already read this book. It was on the bookshelf in my living room and I happened to just pick it up. I had already outlined this part when I read it, about 2-3 years ago (maybe longer). I just happened to open up the book to this page and I was like, “You know what? This would be a good exercise to do…”, so Theo is doing it. [laughs] The outcome of the exercise is to identify what your superhuman strength is. That’s the outcome.
The reason why you wanna identify your superhuman strength, what’s the one or two things that you’re especially good at is it’s so obvious by doing all these interviews that I’ve done and by experiencing things I’ve experienced – when we focus on what we’re incredibly good at, that one or maybe two things, and know how that relates in the context of our business, and do that 100%, then your business will flourish. Find the people who can compliment your strengths in the other areas of your business.
When you focus on your superhuman strength, your business will flourish, assuming that you’ve got other people complementing you on the other aspects of the business. Therefore, the approach for how to do that is — do you wanna explain the approach?
Theo Hicks: Yeah, so basically you wanna create a list of 5 people that know you from different aspects of life… So they see you at work, or at home, or family – they know different parts of your personality, because obviously you act differently depending on where you’re at. So you make a list of five people, and in the book it said know them for basically between one and five years. So they know you for more than just a couple of months.
Then you wanna send them an e-mail, basically asking them what do they believe you do better than other people. That’s it. So you ask that of the five people, and then once you get those responses back, you compile them and you figure out what’s the one thing that everyone said, or what did most people say, or what did at least two people say was your unique gift, your unique capability or strength.
Then you wanna take that and kind of create a paragraph that basically explains what is your unique talent, what are you really good at. Once you know that and you’re getting it objectively from someone else, then you can create a plan of how to cultivate that.
For example, if someone comes back to me and says, “You’re a really good public speaker” or “You’re really good at communicating ideas”, then I’d be like “Alright, so I’m good at that. Now, how can I make that even better?” So maybe I can enroll in some sort of public speaking course, or start a YouTube channel or a podcast, or I practice talking every single day, or I just do 50 minutes/day of just [unintelligible [00:21:28].13] speaking to myself that no one even hears, so I can get better at it.
Joe Fairless: I think the important part after you identify it is also thinking about “How can that be applied towards the business that I’m in?” That’s the last part I think that you wanna do, because you wanna continue to hone it, but if you’re honing it in a silo, then it won’t be as much help. So that would be another thing that maybe — step six, or whatever it is… Think, “Okay, how can I continue to leverage this one skill in the business?” and then maybe think through how is that monetizable… Is that a word?
Theo Hicks: It is now. [laughs]
Joe Fairless: How can I monetize that within the structure of the business?
Theo Hicks: Yeah. So I’m gonna do this exercise this week and then I’ll report back next week with the results.
Joe Fairless: Sweet! Alright.
Theo Hicks: So the last thing we wanna talk about is a question I found on Bigger Pockets. I thought it was interesting and I thought it’d be very valuable to anyone who’s trying to raise private money for deals. The question was “What is the number one question that is holding back investors, or what is the number one thing that is holding back investors from investing in your deals?”
Basically, out of all the deals you’ve done, all the money you’ve raised, what’s the one hesitation or the one reason why investors say “I’m not interested in investing in this deal or interested in investing with you.” However you wanna approach that question?
Joe Fairless: For anyone who doesn’t invest, it’s tough to get an answer from them for why… Usually, after we have a conversation, if they decide not to invest in whatever deal, then they’re not responsive. This is a very small percentage of the people who I talk to. The majority of the people invest, who are accredited and who are looking to invest at least 50k.
I’d say the one thing that keeps shouting out in my mind right now is they want more active control of the deal. I’d say from the people who I do have feedback from, that’s the main thing – they don’t wanna be as passive as how syndications are set up. They want more say in the operations, or they want more say in when we sell, or they want more voting rights for multiple things, and the reality is as a passive investor in our deals you’re putting faith in the team (myself and Frank) to be savvy enough to handle whatever challenges come up and to make sure the interest with everyone is taken care of. And how that is done is not just by trusting us blindly, but by structuring the deal so that there’s alignment of interest within the deal, for example having a preferred return, so limited partners get paid first. For example, having Frank and I invest alongside investors in every deal, so our money is treated just like theirs.
Then, for example on the sale, the general partnership – myself and Frank – we will not receive a penny until the preferred return is paid back and their money is paid back.
So we have checks and balances in place that have alignment of interest, but ultimately someone might wanna be more active, and that’s why on my InvestWithJoe.com page I put “Are you looking to PASSIVELY invest at least 50k?” and “passively” is important, because if they are looking to be active — and you can make more money when you’re active, because I’m not involved, right? There’s not a middle person involved who’s handling everything. You make more money if you’re active, assuming that you’ve got the risks mitigated. There’s more risk, I suspect, if you’re active, too. So that would be the main thing that jumps out.
Theo Hicks: Okay. And then a good way to address that would be to proactively say, wherever you’re trying to find your investors, let them know what your requirements are for investors – accredited, passive…
Joe Fairless: Yeah. The only two questions I have on InvestWithJoe.com – or I guess technically three – are 1) Are you accredited? 2) Are you looking to passively invest at least 50k? And 3) Tell me a little bit more about yourself that is relevant for me to know. Then I jump on a call with them, I get to know them, build a relationship with them, and then after we have a relationship, then that might lead to some business later.
Theo Hicks: Okay.
Joe Fairless: Alright, Best Ever listeners… The basketball – what was the score for the winner? You won, obviously… You keep winning.
Theo Hicks: I think it was 13-11.
Joe Fairless: 13-11? Okay, 13-11. I got a lot closer. 13-11, and then I beat him in Horse… And then I lost the other game 14-11?
Theo Hicks: No, the first game was 14-11.
Joe Fairless: 14-11 was the first game.
Theo Hicks: I think the second one was a little bit [unintelligible [00:26:24].15]
Joe Fairless: No, that was two weeks ago.
Theo Hicks: That was two weeks ago?
Joe Fairless: That was two weeks ago.
Theo Hicks: Okay.
Joe Fairless: Both of them were really close, but one was closer. So anyway… Whoever picked the closest to 14 to 11… Theo won, 14-11, but my secret shot is starting to get better and better. 14-11, so Samantha will reach out to you if you won, and you’ll get the signed copy of the book, volume 1 and volume 2, from both of us.
Are we doing it again? Are we playing again?
Theo Hicks: Let’s do it.
Joe Fairless: Alright, we’re playing again. Same thing – whoever is closest, pick total points, pick the winner, only one entry per person. That’s it, have a wonderful weekend!
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