Danny Johnson is a house flipping veteran, a software developer, a serial entrepreneur, and has many years of experience in the real estate investing business. Not surprisingly, Danny had a ton of wisdom to impart to us and we covered all kinds of thought-provoking questions that every entrepreneur needs to think deeply about.
In this episode, we’re catching up with our old friend Danny Johnson. Danny is a house flipping veteran, a software developer, a serial entrepreneur, and has many years of experience in the real estate investing business.
Not surprisingly, Danny had a ton of wisdom to impart to us and we covered all kinds of thought-provoking questions that every entrepreneur needs to think deeply about.
Links and Resources
- Forefront CRM
- 004: How to Be the CEO of Your Business
- Enneagram Test
- 019: Best Practices for Real Estate Investor Websites w/ Danny Johnson
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Episode 106 Transcription
Seth: Hey, everybody, how’s it going? This is Seth and Jaren, and you’re listening to the REtipster podcast. In this episode, we’re catching up with our old friend, Danny Johnson. Danny is a house flipping veteran, a software developer, and entrepreneur, and has many years of experience in the real estate investing business. We’re going to dive in a little bit about his story. Just get up to speed on what he’s been up to over the past few years and hopefully get some good insights out of this conversation. So, Danny, welcome to the podcast. How are you doing?
Danny Johnson: Hey, thanks, Seth. Thanks, Jaren. Yeah, it’s going great. Thanks for having me on the show.
Seth: For those in our audience who might not be familiar with you, what is your background? Who is Danny Johnson? How long have you been in the real estate business and what all have you done over the years?
Danny Johnson: I’ve been in since 2003 and started with fix and flip. I was working a full-time job for three years before I went full-time. And from there, I had to get fired from my job to actually go full-time because I was too scared to actually do that on my own. It was like I needed that steady paycheck and there was a lot of fear around, “Oh man. Now I’m going to be completely responsible for my income and am I going to be able to keep this consistent?”
But we did really well. We grew that business and spent probably eight or nine years while we were doing it ourselves. And we finally got smart and met the right people and faced our fears in turning that into a business with a team, which allowed us to do other things alongside the house flipping business.
And the real estate investing business provided a lot of freedom once we were able to build a bit of a team to help us with it. Because at first it was freedom, but it had a lot of stipulations. If we went on vacation and we got to call guests who had to take the call and who started feeling anxious about, “Gosh, I got to get back because I need to get this appointment because this is a great deal and I don’t want to miss out on it.”
And so, we grew that team. And once we had that, I was able to start having more freedom to start doing other things that I really enjoy, which is software development and flying. I got my pilot’s license. And so, I enjoy doing that as well.
We spent a lot of time flipping a lot of houses, doing a lot of wholesaling. And I don’t know the exact total, but it’s somewhere close to a thousand deals that were done since 2003.
Seth: Those are all house flips?
Danny Johnson: Well, wholesales, house flips. We did some rentals, some notes, and now I’ve transitioned in the last couple of years to doing more of just long-term rentals as they come. But it’s not my main focus like it used to be.
Seth: One thing I noticed when you were talking, you said you got fired from your job?
Danny Johnson: I did get fired from my job.
Seth: I didn’t know that. I thought you quit your job. What happened to get fired? Did you swear at your boss or something?
Danny Johnson: No, they would give me projects to do, and they would say two months or something and I could do it in a week. So, I did it in a week and then I would just spend the rest of the time analyzing properties and looking for deals. And I think they got wise to the fact that I wasn’t really into the job and needed to make some cuts. Melissa works there at the same place and my manager told her that they were going to be letting me go and that he was going to fight for me or whatever. She told me and I had to go and tell him, “Hey, don’t fight it for me. Actually, this is good for me. I appreciate that and everything, but I need this kick.”
Seth: Yeah, that’s an interesting ethical dilemma. I’m still not entirely sure where I sit on that, this idea of if somebody has a side hustle and that’s what they think their final destination is, they want to go do that instead of their job. Is it wrong to be working on that while you’re at your job during your working hours? I feel like the politically correct answer is yes, that’s wrong. You should only do it during your lunch hours and after work and that kind of thing. Maybe that’s the right answer.
But if I’m honest, when I was at my job, I totally spent time during the day, very similar to you. I got my job done and I spent a chunk of that time doing my own thing. And honestly, I don’t know if I ever would have been able to quit if I didn’t do that. And I look back on that, I don’t know if I feel great about it, but the bottom line is, I probably wouldn’t be here today doing what I’m doing if I didn’t rob some of that time, so to speak, from my employer.
But at the same time, it’s like, if the job is getting done, why does it matter if you’re spending 40 hours or 10 hours doing it? I don’t know. But what do you think about that?
Danny Johnson: I agree with you. I didn’t feel right about it at the time, but I also didn’t feel drawn to correct it. I could have gone and said, “Hey, I can take on more work.” But the work I was getting wasn’t challenging me. And that’s my fault for not saying something and speaking up. And I learned that and I took that into the building of teams in the real estate business and in the software business. And I think I sort of had to pay maybe like the karma down a little bit with figuring out how to really run a team and how to work with people and not make assumptions about them not working as much as they can or doing what they can and all that kind of thing.
But I didn’t feel right about it. And if you don’t feel right about it then it’s probably not the right thing to do. But it’s something that was in the past, I’m not super proud of it, but yeah, along with you, I don’t know that I would’ve been able to succeed enough to the point where whenever I lost a job that I didn’t feel like I needed to find another one. I could just stick to that.
Seth: Jaren, do you know if there’s anything in the Bible about that? About working on a side hustle while you are at your job?
Jaren: I don’t know off the top of my head. I know kind of reverse, there’s a scripture that talks about workers worthy of their wages. So, if anybody does a certain amount of work for them, even if it’s subpar or they could have moved the needle, they could have had a little bit more gusto or effort in their endeavors, still pay them what they’re worth. And there’s a principle there. But on the other side of being an employee, I really don’t. I mean, there’s obviously the scripture, like “Do your work as unto the Lord” and all that stuff, which I think is a good principle.
But for me, I think it boils down to how you’re getting paid. If you’re getting paid by the hour, I think integrity looks like using those hours and only billing those hours, when you’re actually doing work. But if you’re on like a salary, I think that you’re getting paid to get a job done. And however long it takes, if it takes you an hour to get the job done, that you should get paid for the job getting done. It doesn’t matter how much time. I think the time attached to it is kind of irrelevant. In fact, if I were an employer, I would want my team to be really efficient. If they could figure out ways to get stuff done that was super intense within a week so that they could go do other things. Obviously, I’d prefer them to fill their time with other things, but at the end of the day, if our agreement is, “Hey, I’m paying you for this deliverable,” and you’re delivering it, then you should be able to do whatever you want.
Seth: And an interesting thing about that as you’re talking, Jaren, I was just remembering, I was a salaried employee. And I remember there were weeks when we were just crazy busy and I had to work like 67-hour weeks. And you better believe I didn’t get paid a cent more for doing that. And yet I was expected to be there for those 40 hours. Even if the work was done, there was nothing else to do. It’s interesting. As with most things, it’s probably not a black and white thing.
Danny Johnson: Yeah. And now that you said that too, Jaren, I do remember I did work my butt off to get that stuff done really quick. I worked harder than I would have had I not wanted that time to do the other stuff.
Jaren: I think it’s having clear communication and delivering on what you are promised to deliver on. And if you’re delivering on that, then… Maybe I’m a bit spoiled because my career has been pretty strong on the autonomy side. I kind of have been left in my corner to just go do whatever as long as I get it done. Even my situation with REtipster. That’s pretty much how it is on my side. And there are days and weeks where I’m really, really, really swamped with REtipster work. And then there are weeks where it’s a little bit lighter and I fill it with pursuits in the land business and other things. Yeah, I think, all in all, it is a matter of, “Are you delivering on what you have committed to deliver on?”
Seth: Yeah, for sure.
Jaren: Hey, since I’m the one talking here, I wanted to ask you a question, Danny. You come from the house flipping world, which has some distinct differences, but also some common traits with the land flipping business. And I’m just curious what you’re doing right now to find deals? I know that this is becoming notoriously more difficult for house flippers than it is for land investors because typically one of the mails is still direct mail, but I’m hearing from friends and the wholesaling and house flipping industry that direct mail is becoming less and less effective. So, given the higher competition on the house flipping side, how are you getting deals right now? What are your insights there?
Danny Johnson: Yeah, sure. I’m sure there are differences. And especially being that most of my deals come from my website. And so, the online lead generation from organic search with motivated sellers, actively looking for somebody to buy their house. So, somebody that already realizes that they have a need to have an investor make an offer on their house, and then finding me and contacting me.
I’m also no longer focused mainly on the real estate business, because I do have the software that I’ve had to switch focus on and wanting to really kind of switch some focus on too. And so, it’s really just what comes from that. And I’m not really actively doing a lot of marketing, but I do have that website that still continues to bring me deals. They just tend to be the better ones too. So, it’s nice because I don’t have to take a lot of calls and go to a lot of appointments with unmotivated sellers. It tends to be of better quality.
And I don’t have direct experience, recent experience with it, but I know that a lot of people have gone the cold calling and the texting route, which is changing with a lot of legislation and things like that. But as far as cold calling and a lot of the back-to-basics drive for dollars kind of thing seems to be, which is also something that’s probably helpful for the land business.
Jaren: Yeah, for sure. In terms of getting leads on your website, did you just do some SEO work? Are you doing paid ads at all pushing your website or is it just kind of organic?
Danny Johnson: Right now, it’s organic. And so, for a long time, you spent a lot of work doing content marketing and that’s basically writing articles. There’s a structure to it that could be followed. And I think if people just write content to write content. And I know that you guys know this really well because you’ve done a fabulous job with your websites. And it’s really structuring it in a way where you’re covering different forms of motivation that people that end up with houses, that they have a problem that helped selling the house would solve that problem and help solve that problem. So, probate people are searching for a lot of inherited houses with questions and things. What do they do? What do you do about taxes on an inherited house? What is the probate process? All of this kind of stuff, and you write articles.
And the way I would do it and the way we did it in the past and continue to do it. Because it still works. That’s what Google wants. It’s something where you’re providing a lot of value. Somebody searches for something, and they want a good result that somebody is actually going to get the answer that they were looking for. They had a question and you’re providing the answer.
And so, splitting up different categories say probate rental, lot of landlord issues, taxes, property taxes, code compliance issues. Breaking those up, and then writing articles based on all of those. Brian Dean, I think is his name, he does a lot of SEO stuff online and has a general search engine optimization blog. And the website is backlinko.com.
Seth: Yeah, I’ve heard of that.
Danny Johnson: Yeah. His approach I think is one of the ones that’s going to be evergreen. It really gets into what the whole idea of the search engine is and what websites are for. And it’s really filling that search intent. They have an intent that they have when they’re searching. And then if you fill that through what content you have.
But when you group them like that, and you create the articles that all kind of fall within that category, you can interlink them. So, you might have one article that talks about, “What do I do now that I’ve inherited a house?” And you can do five steps or five options that you have when you inherit a house. Obviously one of those can be “Get a cash offer from us.” But then you give them other options too. It’s not just so lost because we’re the best. You’re actually giving them some options. Something that they’re trying to find out what they can do.
Well, if you write another article after that that has to do with what happens with past due property taxes on an inherited house or something that’s related that somebody could be searching about. You link from one to the other, and then from the other one to the other. And that kind of builds the structure with internal linking within your website that boosts sort of the whole value of the whole thing. Because it’s not just having one piece of content on its own. Then the spiders for Google say, “Hey, this article is about this. And it’s also linking to this one. And so, this is kind of an authority site on this subject matter.”
And you might think, well, there are millions, maybe even billions now. But maybe millions of websites. So how am I going to compete with these bigger websites that write this content? And the thing is that most real estate websites are focused on a locality, like one location. You’re in one market most of the time. And so, for me, it’d be San Antonio. So now I’m not worried about the rest of the world. I’m writing something that’s related to San Antonio. And that’s all I’m trying to do, is get ranked in San Antonio. And so, it’s really not as daunting as people think.
Seth: What do you do on your website to tell Google, “This is only about San Antonio”? Do you have to plug San Antonio all over the place so that Google picks up on that?
Danny Johnson: You don’t do it too much, but your website, yeah, it should have San Antonio, but also things related to San Antonio. Because Google is also smart enough to relate different terms like “San Antonio Riverwalk,” “San Antonio Spurs.” Just have different things scattered throughout that, that really shows that it really is kind of a local article that’s standing out against all the other general stuff. Because I think Google does like to show relevant local stuff. I think it’s a little bit more pertinent to people.
Seth: Yeah. For years people have told me that I’m this SEO genius or something like that, which is funny because I’ve never even understood it. I’ve never even tried to do it until about a year and a half or so ago out of necessity. But as I’ve been trying to figure out SEO, I think one really crucial component that makes it work is if you’re really trying to change a person’s life for the better and putting tons of time into making it the best piece of content that there is on the internet for that, which is hard. It takes a lot of work to do that.
Another thing I’ve learned is the importance of backlinks. It used to be that that was all that mattered. It doesn’t matter as much anymore, but it’s still very important and that’s hard. You don’t just snap your finger and get really high-quality authoritative websites to link back to you. And it also has a lot to do with the existing competition for that keyword that you’re doing. There are some things that you will absolutely never rank for. Like just don’t ever even try it. The highest-ranking websites have thousands of other websites pointing at them. You’re just never going to get that.
But there are things that once you get more niche down and more specific, it’s actually not that hard. And there may not be as many people searching for that one term, but still for those who will, you’re going to show up pretty high up there, if not at the top, because you’re the only person talking about it. For example, how do I get rid of my house that’s infested with spiders? Something like that. There’s not a lot of people searching for that.
Danny Johnson: That’s also the beautiful thing about that whole approach. It’s that no, there’s not a lot of people searching for it. So, most people won’t ever write an article about it. And so, since you did, they may or may not be searching for that exact thing, but that article has other words and phrases in it. And the combination of all those articles, each one’s not getting searched so much, but as a whole if you start looking at what your site is ranking for and you find out. This is an example, 30 content pieces and Ahrefs is showing that I’m ranking for like 4,000 keyword phrases. That’s really the beauty of that. And then all of a sudden, it’s like, you’re not going to hit crazy traffic numbers from any one of those, but combined it’ll add up and it actually starts producing.
And the beautiful thing about the local, again, just to your point about backlinks and the importance of those. I have seen websites rank for competitive keywords that had zero backlinks. And I don’t know how exactly they’re doing that, if they’re using mechanical turks. We can get into crazy details with SEO. But with local, the beautiful thing about local websites also is that you can write an article about some local restaurants or something. These are the restaurants that are my favorite in town. And then tell those restaurants that you’ve written and get them to backlink from their website, because you just put them on a list or something.
Seth: Yeah, that’s a good idea.
Danny Johnson: You want it to be relevant, right? So maybe if you can rank sort of like real estate agent companies or something then it’s real estate related even, if you can get some of the backlinks from them. But anyway, there’s different ways to do that.
Jaren: And I just wanted to jump in there. Danny just mentioned for our listeners a resource called Ahrefs, which is kind of weird. We’ll put it in the show notes that you can find at retipster.com/106. And what that is, it’s essentially a keyword ranking tool that has a lot of data about different keywords and how different websites rank on those keywords and a ton of stuff. It’s really helpful if you would want to go into the world of SEO. We’ve had a couple of deep dives in the Ahrefs, between me and Seth over the years. So, it’s a good resource, but it’s a lot. So, if you go in that direction, make sure you understand you’re opening up Pandora’s box.
Seth: Oh, yeah. For sure.
Danny Johnson: That’s a ton of data. That’s sort of like Zapier, right?
Seth: Yeah. I still don’t even fully understand Ahrefs. There’s just so much to it. I think I got the basics. Like you can do a website audit to figure out, “Hey, here’s all the broken links and here’s all the fix this and this and that”. And you can figure out if you’re trying to rank for this keyword, here’s all your competitors that are doing that. And here’s what you have to do to beat them. But there’s so much more beyond that, that you can do that I just don’t even understand.
Danny Johnson: Well, you can end up down in a bunch of rabbit holes.
Seth: Yeah. People can make their entire career as an SEO specialist just using that. It’s that powerful. SEMrush is another very similar tool.
Jaren: Yeah. It’s interesting because the unfortunate thing with a lot of, or I don’t know about necessarily if you have some crazy competitive advantage, some high-level strategy on the SEO side and maybe this isn’t true. But I found that when it comes to content, a lot of it is just shooting from the hip. Like you try to create the best piece of content, the most helpful thing out there in existence. And then you have to wait six months or more to find out if it actually made any kind of damage at all. Like you can put your heart and soul into something and nobody ever sees it. And it’s just like, “Man”. So that’s a very, very long-term approach to content marketing.
Danny Johnson: Yeah. Well, I’m glad you said that because yeah, it absolutely is. I’ve always said that’s a benefit though, because then most people won’t do it. They’ll start and then they’re just like, “You know what? Forget this. I need to do something with more high leverage”.
Jaren: Especially for real estate investors. Because I think by and large our personality types, or at least the personality type that’s gravitated towards real estate investing is more kind of like Seth uses a pretty cool phrase, he shares this paradigm of being a “hunter” versus a “farmer”. Hunters go out and they slay the dragon and bring home a feast. And then farmers or people that are so into seeds and watering seeds and at harvest time, they’re collecting a crop. But it’s a very different lifestyle and a very different approach.
And content marketing is much more of a farm. It’s a virtual farm where you always have something that you need to work on, there’s always a fence, some virtual fence over here that needs to be fixed or the cows need… I don’t know what you do with cows. I’m definitely not a farmer. But you always have something that you have to do and maintain. And you don’t know until the seed grows what kind of harvest you are going to have.
Danny Johnson: I think that also relates to other parts of the business too. I spent eight or nine years wearing every hat in the business. Doing the marketing, taking the calls, appointments, getting deals, starting the crew, contracting crew to fix up the house and then selling it and then going back and ramping, marketing up again. It’s like this feast or famine cycle. And it’s like, I’m too busy to stop and figure out how to get out of this, like how to get out of this constant cycle of hunting all the time. I got to hunt all the time. I’ve got to do all this.
And if you stop and really look at “What can I do to make it so that I’m doing a little bit extra work now that’s going to pay off for me eventually?”, it seems like the first thing is the hire. And I had all these fears around hiring. I can’t hire somebody because I’m still not very comfortable that I’m going to be able to consistently get deals to support a team or support even one person and what that’s like and how I’m going to manage them. What that all even looks like.
Because the mistakes that are typically made are, the mistakes I made at least, were to hire somebody and then say, “Okay, why don’t you just shadow me and I’ll show you what to do?” Well, we’ve learned so much in the business over the years that we have hundreds of different processes in our heads that we run through to do things and how to do things, but they don’t even know any of it.
And if they just see you do something for a week and then you expect them to be able to do it, you’re setting up for failure. And so, it’s taking the time to plant and create those processes before you bring somebody on. To really start getting into a thing where you’re actually building a true business that can sustain or have people come on and set them up for success.
Seth: Yeah. That’s a big challenge. I can’t even pretend that I have that figured out or I’m good at that. I’ve always had a lot of the same fears and it’s just what you get with working with people. It’s like the best and the hardest part of any business. Nothing really happens if you don’t have the right people. But there’s a lot of struggles with that too. Like getting them up to speed and getting to understand different learning styles and different strengths and not even knowing people’s strengths until you see their work. It’s just, I don’t know. It’s hard. Like I get exhausted just talking about it.
Danny Johnson: Yeah. Before you even get there, setting up the business, operate like a business. It’s processes, but it’s also the numbers, knowing your numbers. And I’m sure everybody out there listening has heard this kind of thing before. And the way it’s been put to me that I’ve just always remembered as if it’s not measured, it can’t be managed. So, you might have a general idea, but if you’re not actively measuring it. And that’s not just like once every year, you’ve got to actively be measuring and seeing what’s happening. And in order to measure, you have to know what you’re measuring.
Jaren: Yeah. I love that. I wanted to ask you guys this question, as we’re talking here. I also am dealing with this same kind of fear in my land business. Like I think I’m at a point where I might start bringing on some VAs. And I know it’s a much smaller scaled down version than having like a US-based operation with W2 employees and the whole nine yards of that. But there’s still this thing in the back of my mind, like right now the land business seems to be, at least my land business seems to be popping. I think the market is just in a situation where you can get any kind of deal, even if it’s like a squat and your head kind of a deal like, “Ah, I don’t know, maybe”, but it just seems to be selling.
Just this morning I got a property that I haven’t even closed yet on the buying side. And I have an agent who’s like, “It’s already sold. Just let me know when it’s closed”. And I got somebody and he told me originally numbers wise that we could sell it for $15,000. And he’s like, “No, I got somebody at $16,000. He was ready to pull the plug”. And I mean, it’s amazing.
And typically, it takes about four and a half months to sell a property for me, but I’m selling things really quick. And so, I’m like, okay, revenues are coming in in the short-term, but how long is this going to last? And if you have a long-term approach to this, you know that market cycles happen and that nobody can predict when they’re going to happen.
As to people who’ve been successful in business, both on the real estate side and in kind of other endeavors, how do you, as kind of the captain of the ship, navigate those waters of like, “Okay, I am on the hook for people’s livelihood. If my company stops making money, they’re not going to eat”? Because when you’re flying a solo, and especially me, because my land business isn’t my primary source of income. It’s okay if I have a quarter that’s absolutely terrible, but if you have employees in the mix and all of a sudden that doesn’t really fly. So, how do you guys prepare for that? For somebody in the audience right now, who’s in that transition of like, okay, I think I’m about to start stepping into scaling or growing, how did they navigate that? Because that is a legitimate fear. It’s a legitimate possibility to have a negative outcome, right?
Danny Johnson: It’s a combination of things. I’ve drawn this recently as a model. You have an X axis and a Y axis. And the Y axis can be your management. You have different levels of management, right? You’re either not managing anything or you’ve got everything measured, dialed in. And then you have an X access of deals and this is probably hard to do over audio. So, I’m going to try to simplify it a little bit.
But the X access is deals. And so, if you’re on the negative end of the X axis, your deals are kind of a feast or famine sort of what I was talking about before, when I was solo doing marketing and then having to slow down marketing because I got busy dealing with the properties, dealing with the deals. And then I got to pick it up. So, it’s all start and stop, start and stop. And it’s really hard to be consistent. And so, you’re down at that end of it.
And if you’re not managing, and you’re not measuring and looking at stuff, you’re just like, well, I know I need more deals, so I just need to pump out more marketing, do whatever I was doing before that got me these deals and just do more of it. Or I heard something on a podcast and I’m just going to go try that. Where there’s not a whole lot of planning involved, then you’re down on the negative axis of the Y.
I was calling that chaotic irresponsibility, because it’s really kind of what it is. You’re just reacting to everything, right? Like almost everything is a reaction. This happened now. I need to do this. And so, this is a wild swing. Well, where we want to be is at the top right quadrant, which is on the positive of both of those axes, where you’ve got measurement, which requires data and then you’ve got deals happening. And so, what you’re doing is you’re building predictability. You can’t predict everything, but they can predict the weather pretty good even though that’s really hard to do. But with the right data and the right understanding, the predictions are pretty good.
And so, if you are saying, okay, things are working out really well right now, but I’m worried that it could change after I brought people on and am I going to have to cut them? Am I going to have to tell them, sorry, I don’t have enough work for you or we’re not doing well and I don’t want to have to do that? Especially for what that might mean for them and put them in that position. And so, it’s not something that you can do overnight and feel comfortable with.
But if you start measuring what’s happening in my business and then looking at that trend week over week so that you can see, “Okay, five weeks ago, this metric was this number. Then it was this number. Then it was this one”. It doesn’t take a whole lot of change over three, four or five weeks to see something trending in some way. So, no longer are you reacting when it’s like a crazy swing.
Like if you’ve got a broom. Have you ever seen that physics experiment? You got the broom upside down on your hand and you are kind of balancing it and you make little adjustments. And it’s okay to do that. But as soon as it swings out a little bit, it goes crazy and then falls. So, it’s like measuring so that you can see week over week. So, it’s still a little adjustment and then it stays in balance.
But what that allows you to do is really tweak your business because you’re saying, “Okay, well I’m trending right. So, this is good. I need to focus on this piece of it”. And I know it’s kind of vague when I talk in terms of this number or this metric, but in the businesses that we’re in, it’s really not that complicated.
What we’re measuring is what did we spend on, what campaigns, what did each of those campaigns produce? And not just in terms of calls or web submissions, but what happened with each of those that we got from each of these campaigns? Did those turn into appointments? If not, why?
We now can look and say, okay, these did this well, that one was horrible. Why was it? Is it because this source is really generally unmotivated and it’s not typically people that are easier to work with? And you can start to dial all that in.
Then if you have, okay, the appointments are good, but we’re not getting contracts or we’re not making offers. At one point, we had this many appointments. We don’t have that many offers. Why not? If it was something that was worth going to an appointment on, there should have been an offer made no matter what. I don’t care how bad that property was. Some offers make sense. Even if that seller has got to come to the table and bring some money to the table. Because we’ve had people bring $20,000 to the table just to sell their house to us.
I feel like I’ve gone on for a while there, but that approach, I think takes and create some predictability in the business to where you’ve seen what happened and you know that by tweaking some things that it’s not going to get wildly out of swing to where you’d have to let somebody go right away.
Seth: Yeah. I think there’s a lot of truth in that. I’m trying to create predictability. For sure. I think what I struggle with is at some point, nothing is fully predictable. Things can always start going sideways. The market can change. Demand can change. Popular opinion about things can change. Concerning REtipster, Google can change. Other websites can start ranking higher than we can. On one hand it feels predictable. And it may be if the world doesn’t change, but we’ll always change at some point.
Danny Johnson: Who’s in a better position when that happens though? Because it’s not something that doing one thing or the other is going to give you different results. That affects everybody across the board, I would think.
Seth: Well, sometimes. I think it was John Paul Getty. He said “In times of rapid change, experience can be your worst enemy”. You think you know what you’re supposed to do because that’s what’s worked in the past. It’s not what’s going to work in the future. And that’s what I think really can kind of kill some businesses and this mindset of, “Well, this is what we’ve always done”, but that’s irrelevant anymore. It doesn’t make sense. It’s not how the world works now.
Danny Johnson: Yeah. And I agree with that. I think creating predictability is looking at what you can predict, maybe for the next one. But I would never say, “Hey, this is predicting that the whole next year is going to go this way”. I’m predicting what next month will be like, because I see a trend. And something massive happened.
Jaren: Seth, I want to just jump in there and ask you because I agree. I think that it’s good as much as you can do what Danny is saying and understand, “Okay, I’m on the forefront of the battle line. I understand, I’m in the trenches. I’m keeping my ear low to the ground, understanding what’s happening, trying to navigate the waters”. But there are times where life in the industry just blindsides you and you just get hit. And it’s like, “Okay, how do you navigate those waters?”
So, you highlighted a really good point, but do you have a solution to that? As a person who’s in the leadership position of your company, what do you do when that happens? What’s the game plan? Do you just have two years’ worth of savings and then hope for the best? Or what do you do?
Seth: That’s the thing. I don’t have a silver bullet – “This will always protect you and save you”. But I do think having some kind of a sinking fund of “This will get us through this trial if this comes up” or a plan B or a diversification, “Don’t have all of your income coming from a single source”. All these things can play a part in that.
And also, you look at other historical companies that have survived. I might be totally wrong on this. This is my vague memory. But Phillip Morris, I think is one example that comes to mind, the tobacco cigarette smoking company. And obviously as the world got wise to, “Hey, smoking is going to kill you” and all of the customer base disappeared from that. I don’t know if they created craft food there or what, but they basically just totally shifted to open up a new line of business and go in that direction and sort of slowly acknowledged, “Hey, this old business is going to die”. Again, maybe I’m wrong about the company.
The principal being, when you see the tides of change are coming, be ready to adapt to that and have different alternatives and different directions you can go. And hopefully you’re going to catch it before it’s too late. I don’t think that kind of stuff usually happens literally overnight. You usually have some lead time, but you have to be paying attention and looking for that. If you just kind of blindly put your head down and do what you’ve always done, at some point it’s probably not going to be as effective as it was before if it works at all.
Jaren: Yeah. I think it’s about staying humble enough to change and be teachable. Success is intoxicating, man. You start getting a system that’s working or you start making money and stuff, it’s really easy to have ego creeping. And I think that if we could figure out a way to always make ourselves humble or I don’t know how you sustain that long-term but if you can somehow always not assume that your way is the best way, even if you have gotten the best results that way in the past, it’s always staying humble enough to be teachable. Maybe that’s something that can work with a lot of savings and contingency plans.
I did want to say one more thing to what Danny was saying. And then I had a question for Danny. I really liked what you said about building predictability. I don’t want to diminish that point because I think that I really loved your analogy about the broom. Just slight adjustments, keep the broom going. It keeps it from crashing.
There’s a book that I’ve been reading recently called “Principles” by Ray Dalio. He’s some big wig on Wall Street. That’s not the world that I’m in. So, I don’t really know exactly outside of the book who he is or any of that. But something that was really interesting that he said in that book, he said that he is convinced that if he were to be able to process literally knowing all of the unlimited amount of data, he would be able to predict the future.
He was cutting edge in his investing firm when it came to using computer technology to predict trends and stuff in the market. And I guess personal computers were primarily used in finance for a long time before they became kind of widespread of personal computers and people doing what they do, like the 90s and the advent of the internet and all of that.
But he was saying that he created this program where, because he had been working on it for so long, he was able to just crunch in the problem of whatever he was trying to assess in terms of his investment. And the software was so much more efficient in telling him what to invest in that obviously he would weigh it against common knowledge and common sense and kind of the human factor and all that. But by and large, like 80% – 90% of the time, his software would tell him what kind of decisions to make from an investment standpoint, because this software could process so much data.
And one of the things that I think a lot of beginning land investors, or just real estate investors, business people in general, they just got to fly by the seat of their pants. I didn’t track any data for a long time. I really started tracking solidly this year. If I’m honest, this is the first year I’m like, “Okay, how much did I spend on direct mail? What kind of rate did I get? What deals do you get from that? How much revenue came from this campaign?”
If I were to do something different, I would be tracking data from day one. I would be tracking things I wouldn’t even have a purpose for. I just want all the information that I could get, because over time that information presents a roadmap on how you can be successful or what your leverage points are and all of the things that will give you a competitive advantage in the future. So, I just really loved what you shared there. And it reminded me of that principle that if somehow, we had access to all data, we’d be able to predict the future.
Danny Johnson: Yeah, that’s cool.
Jaren: One of the things I want to ask about building a team is how do you ensure that you’re going to get somebody who’s quality? And then if they’re quality in the beginning, how do you keep them motivated or how do you keep them continuing to produce good work again and again and again? Because I think that’s another big challenge that people run into. It’s like, okay, I hired a VA, but I don’t know if I train them without micromanaging them, I don’t know how you get around quality control. Because at some point you have to just trust them and kick them out of the nest. But this is your baby you’re dealing with in terms of your business. So, how do you navigate those waters?
Danny Johnson: That’s a tough, tough question. I continued to even make mistakes with hiring. I mean it’s working with people, right? Everybody is different. Nobody can fit into some box and say, this person is like this completely. And then you’ve got your own perspectives and how things are.
I think your question was kind of multiple questions because there is a motivation factor in there and then also a quality factor and maybe all of them kind of interrelate in some way. Obviously, money is a motivator for people to work. They want to know how much I am going to make. But a lot of times that’s not like the main reason why they’re working somewhere.
And so, there’s three factors. It’s autonomy, expertise or something. And I’m going to screw this up because I don’t have it in front of me, but there’s three different ones.
And it’s like different motivating factors. We have them rank and I can get those to you maybe after this, but it’s autonomy, being an expert and then recognition. So, pats on the back, that kind of stuff.
And autonomy is being left alone to do the work and being trusted to do that. When we interview them, there’s no right or wrong answer to that, but you get an idea. We just have them rank those in order of importance for them. Because then you get an idea of this person, how they like to work. And a lot of times it’s really just setting them up with here’s the processes, here’s what we’re measuring and this is the expected results.
So, we’re measuring these things that are measurable and we expect these results. These numbers need to equal this by this amount of time. And so, this is how we’re going to say whether or not we feel like you’re doing a great job. Setting those up. And then they kind of know, this is how I’m being measured. It’s not that I got hired and told to do this, but this is how they’re going to know whether I’m doing it. And then they can feel good about knowing that they’re not having to guess what do they really want me to do?
Seth: Yeah. Sometimes I wonder, I’ve got a good friend of mine, he’s also an entrepreneur at a similar level that I’m at in terms of his journey and growth and that kind of thing. He’s super talented. And he loves hiring people and developing people and building teams. It’s like his favorite thing to do. At least that’s how it comes across to me.
I do it more out of necessity. If it was possible to just manage everything myself, I would, but it’s not possible. And no offense to you, Jaren. I love you. But it’s not my gift. It’s not my skill or the thing that I love doing. And sometimes I feel like other people suffer as a result because I’m not that good at it. And it makes me wonder, “Is there any way to make somebody else do this stuff?” Just because I own the company, do I have to be that guy who trains everybody up and gets everybody ready to go?
I’m sure once you grow to the point of having like 20 people at your company, then it’s probably a lot easier to pass it off to somebody else. But when you’re at sort of a micro company level of two to five employees, it feels like you just have to figure this out to some point. You can’t just pass it off to someone else.
Danny Johnson: I think that was my statement, I’m still learning this, right? Because I think it’s still a level of growing through our own ego stuff. Fears of, “Well, it won’t be done as well as I need it done or they don’t have the entrepreneurial mindset to be able to think of these things. And I still have to think of them until they learn to do that”.
Even recently, I can remember sometimes where I start getting into the mindset of, “Okay, that person has got a ton of time on their hands because right now things are slow in this area or something”. And I’m bothered because they’re not coming to me, but guess where that’s coming from? Where is that feeling coming from for real? And I’m just realizing a little bit more now because I just told you guys, that’s what I did at my job. And I felt bad about it.
And so, now I’m imagining and projecting that on to somebody else. I found myself sending messages in a sort of passive aggressive a little bit and saying things like, “Hey, what are your ideas to do this? Or how come you’re not doing this?” And just sort of not being a really good leader.
And I recently kind of realized that that was happening and said, “You know what? I’m going to drop all of that. I’m not going to stress over it. I’m going to accept the situation. The fact that this person doesn’t have a whole lot to do right now and just accept that. And I’m not going to try to figure anything out and I’m just going to let God or whatever you believe have its way in what’s supposed to happen here. But my coming at it from this wrong place is not going to help the situation”. I don’t know if that’s a little bit too hypothetical or above things in an abstract way.
Jaren: I think it’s spot on, man. I’m really glad you shared that. It’s unfortunate because you want people to be able to care about your business as much as you do. But most of the time they won’t and it’s hard. My sister-in-law and my brother-in-law, primarily my brother-in-law, is kind of my full-time VA in the land business right now. But I just realized that I assumed that they know how to set up Google Drive and organize their workflow. I realized there’s like a major mess between different lists that they’ve done and haven’t done in all this because they didn’t have that set up. I think you said something about people are only going to care, like 80% or so of your business or something. Or maybe you didn’t say that, but it prompted the thought in my head.
But I think we need to run our businesses as though we’re only going to get like 80% of output from people. When I have somebody like my brother-in-law or sister-in-law or whatever, do a purchase agreement or do something, they don’t do it to the degree that I would. I don’t know why, but they don’t. They just don’t care as much or whatever. And as you said, accept the reality of that.
If you find an outlier and you find somebody who loves your company, as much as you do, then hire them and make them very happy to stay where you’re at and keep them motivated. But by and large, I think we have to build a system where it’s like, “Okay, if most people are like that, then I need to be able to have a system where people can output 60% or whatever and the job still gets done and the system still works”.
Seth: Yeah. But which 60% will they output? Which part of the job are they going to be terrible at?
Jaren: Yeah. It’s hard to figure out, man.
Seth: It’s okay if you screw this part up, it doesn’t really matter. Just do well on this part. And then they’ll lose 60% of that part.
Danny Johnson: Yeah. Paying too much for land or something.
Jaren: I had my brother-in-law do pricing one time for less, and that was a mistake. So, it doesn’t happen anymore. I make sure I’m the guy that does that for now. But see, the thing is that’s not scalable, right? Like if I were to really go hard, if I were to do 5 states or 10 states, I can’t price every single property myself. I have a full-time job at REtipster. I don’t know what the solution is.
Danny Johnson: I think something that helps because I do want to continue, like what I was talking about with accepting, stopping, ruminating about “This isn’t efficient, this person could be doing all these other things” and accepting the situation. And some people could see that and say, “Well, then you’re not managing, you’re just ignoring the situation”. And that’s a concern.
But the purpose of accepting it was to let go of all the ego garbage. And then not turn around and say, “Okay, I let it go. Now let me figure it out” because you’re still operating from the same thing. So, it can be like, “Well, what happened then?” And I do remember the specific case that I’m thinking about what happened. And what happened was because I wasn’t bugging them and telling them, “Hey, do this, do that and you need to do this thing.
I came from an approach of saying, “Hey, I know that there’s not a lot to do right here right now. Here’s some of the goals that we have to meet. And would you mind helping me? – Yeah, yeah, no problem. – Okay. Well then why don’t you come up with some of the things that you think that you could do that can move the needle here and do some of this stuff?”
And then they’re coming up with things that they can do and then they have bought and they’ve created this plan. And it was a beautiful resolution. Whereas in the past I would get to the point where I literally got to where I had something against an employee and then fired them. And then sometimes they would feel like they got blindsided. It was like, “What? I thought I was doing a good job”.
Jaren: Great insight there, man.
Seth: Yeah, for sure.
Jaren: Good stuff.
Seth: Switching gears a little bit. Danny, when was it in your real estate investing career that you decided, “Hey, software, that’s something I should do”? Was that part of the idea from day one? Or did you kind of realize it a few years into your house flipping wholesaling career? Tell us how that came to fruition.
Danny Johnson: Yeah. I went to college. I got a computer science degree. And so, I was always into software since high school. I graduated college in 2000, so that was the boom. That was the whole internet explosion and all of the web stuff. But even though there was that excitement in that, I was working for a boring defense contractor in San Antonio with top secret clearance and stuff. And the work, it was mostly parsing files. It was not exciting computer stuff. It wasn’t like coolpets.com or whatever. I don’t know what was cool back then. Maybe like Google, I guess it’s the only thing remaining from some of the big stuff.
Seth: We’ll imagine what’s cool and this was the opposite of that, right?
Danny Johnson: Yeah. And my dad started flipping houses while I was in college and then right afterwards. And just the level of excitement that he had for life, all of a sudden, and what he was doing, I saw that and I was like, “Whoa, I need to do this too. I absolutely need to get into this”. So, I got into the little house flipping thing.
But having a system, how much it would help me to have a system to track these leads that were coming in, because it was getting to the point in my notebook where I was putting the calls and stuff in that I was losing stuff. And the whole call to them, and then make a note two pages later, which represented two days later, call them again, was not a system that’s going to keep me following up with anybody. For any length of time, once we got to the volume of leads, we needed to get to. And so, that’s why I started creating software.
Seth: Gotcha. What is all the stuff that you’ve done? I know you did LeadPropellor and you did FlipPilot and you’ve got a new thing now, right?
Danny Johnson: Yes. FlipPilot actually morphed and became Forefront as what we just launched as its Forefront CRM. The reason for it, the modifications, because really the evolution of that product, it’s sort of like it’s the ninth version, from my very initial one that was on my laptop. If my laptop got stolen or broke, I was screwed. All my data was gone because it was just way back when.
This latest evolution was really getting back the basics of what is the system really for, because we jumped on the whole thing, everybody else was as features right? Whoever has the most features, has the best product. And that’s definitely not the case.
What we found was everybody was so frustrated with the fact that they’re spending more time setting up their CRM and training their employees on it, that they were spending more time dealing with that and answering questions about it for their team then they were actually doing deals. And it was getting back to “You know what? Let’s stop making this assumption that what everybody wants is this laundry list of features that they don’t even understand or use and figure out what is this thing even for”.
Because I even had somebody ask me, somebody close to me, I think. And they were like, “Well, what do you need this for?” And I was like, I kind of even lost track of what was even the purpose of having this. Why did I need it in the beginning? And I had to think about it. I was like, that’s not right. It shouldn’t be something that requires thought as to why anybody needs this thing. But it’s tracking leads and follow up. You can do some things to make that sound cooler or be cooler.
But at the end of the day, you need a system that’s going to do that. And in a way where you can treat software, like most of us treat it. I mean, I’ll speak for myself, but whenever I sign up for software, I will sign up and I will go in and I’ll click buttons. I won’t watch a video. I won’t read a bunch of stuff. I have to just be able to figure it out. Otherwise, I don’t want to use it.
One of our core values is simple. And so, that’s our goal when we set out to create this. We created it differently, because our focus is if you have qualified leads. So, it’s not for everybody, I always get excited about talking about this. And I don’t want it to get to be sort of this pitch thing. But what we like about it is it is visual. We created something that’s more visual. If you’ve ever used Trello or Pipedrive, you log in and you can see what properties you’re working in, where and where those are at. And we’re just sticking to the whole simplicity thing, powerful but simple so that your team can figure it out really easily.
Jaren: My follow-up question to that is, I know you’re not on the hamster wheel of features, but would you mind just going over kind of the stuff that it does do? I love how you summarize it, that is the point for at least real estate investors, it’s lead tracking and follow up. Do you have any automated follow-up sequences? Because a lot of that stuff breaks and it can get kind of hairy. And now there’s apparently some legal stuff related to text message blasts that’s on the horizon. So, what does it do and what does it not do?
Danny Johnson: The first thing to mention with what it doesn’t do, because you’re right, there are things coming down the pike about text blasting and stuff like that. We don’t do prospecting in the system. We leave that to other tools that are focused on that, that can stay abreast of legalities and all that kind of thing.
So, if you’re not generating leads then this tool really isn’t for you. The whole purpose of this tool Forefront is to keep your leads at the forefront. Like you see them and you know what you’re working. And so, everything can automatically come into the system. But if it came into the system, you’ve already generated that lead, that seller already wants to get an offer from you. And the tool focuses on doing everything it can so that you can turn that lead into a deal. And how does it do that? It does it with the automated follow-up as one of the things.
And the benefit of us having had this evolution of the tools over the years is we’ve been through the problems and we’ve been through what doesn’t work and what works and gotten to the point where it’s like, we know it’s solid. It’s good.
And we’ve been through all of the thinking of investors, because we even have people that are good friends and using the system. And I asked them “Who’s using automated follow-up?” and some of them said, we’re not doing it yet. And the other half of the people that were on the call were like, “What the heck? Are you crazy? You should be using this because you’re missing out on deals”.
And so, we ask them, why are you not using the automated follow-up? Thinking maybe it was something they couldn’t figure it out. We’re all about simple so we want to know that. But it wasn’t that, it was we’re concerned that it’s going to come across as salesy and pushy. It’s like, “Whoa, let’s dig into that. Why are you thinking that?” And it wasn’t just me. It was the people that were using it that were also like, “Why are you thinking that, man? That’s the wrong thinking”.
It’s all about timing and they just didn’t know what they should say. Like how it should be approached. Because if you’re just thinking, I’m going to send out messages that are like, “Hey, are you going to take our offer now?” or “Are you still thinking about my offer?” that kind of stuff, yeah, you’re going to bug somebody if you send enough of that stuff over and over without a response.
So, if you approach it from, “I know I’m sending these out and if I were to receive these kinds of things, what do I want to receive?” Because if you do it right, then the people kind of like hearing from you, because all you’re saying is “I’m still here. I’m still interested in your property. No pressure, but I just want you to know that I’m here and I’m interested”.
So, it’s like, “Hey, were you able to sell it?” or just something short, sweet, just get them to communicate back with you. I’m trying to make this also toward anybody, so that even if they’re not using that tool, they can use this with follow-up.
And whether you use Forefront or not, there’s ways to do follow-up that really make it beneficial and not harm you or your company. But having customized stuff in the short codes so that when these messages go out, it also includes that person’s name, their first name or something, and the property address or whatever you want to put in there. So that when you get a text, if it’s got your name and it’s got the property address you were selling, it kind of seems like somebody must have typed that in. And so, it just makes it be more legit like that.
Seth: Is this going out as text or email or something else?
Danny Johnson: Text and email. We limit it to that just because of the annoyance factor. People are so ticked off about ringless voicemail and stuff like that these days that it’s just something we’re kind of staying away from. And then you can also set up tasks for you and your team to do actual manual follow-up. It’s important. So, you can do that.
But the idea that one of the people had was, they said, “Well, I’m okay with it. But my acquisitions person, the person who actually does all the communicating with the seller wasn’t. She was the one that had a problem with it”. And somebody had a good suggestion and said, “Well, what she did was she had her acquisitions person actually create the sequence”. So, she could say what she felt was right. And it was great because I thought that was a brilliant idea because then the sellers are getting messages from somebody that are from the same personality of the person that they’ve met.
Seth: With Forefront, does a person need to also sign up for a texting series and an email blasting service and anything else, or is it all kind of built into that one platform?
Danny Johnson: No, we integrate with CallRail. And I recommend CallRail because of the fact that it’s got such a real bust call sequencing system, where you can do Round-Robin, you can do all kinds of stuff. So, if you want to take calls from a certain time of the day, and then after hours, have it gone to some call center or something, or somebody else, it’s so easy to do it.
We set up our own phone system in a previous version. And it was interesting because we had people saying that they were worried that it wasn’t going to be as reliable as CallRail or something like that because it wasn’t our main business. And then we were trying to match all those features. It’s like, wow, we’re trying to do all this and to be better than CallRail? That’s kind of crazy.
Seth: Are you actively flipping houses and wholesaling and other stuff right now as well?
Danny Johnson: I am, but that’s not my main focus. So, I don’t have a team for that. I’ve got my website still and I have the leads come in and I will still go to the appointments. I like it because it’s still using Forefront and then using the mobile app and stuff. And that gives me a bunch of ideas too because I’m actually going through it and saying, “You know what? I wish I could do it right now”. And so, we add those as features and stuff too. But I do have a historic home that’s being rehabbed right now and just wholesaled one, that was a hoarder house. And that was nice because it was like a $50,000 home sale.
Seth: Cool. I’m genuinely curious because I find it extremely difficult to run two different businesses well. It’s almost like one has to take the front seat and the other one kind of has to lag behind. It’s just there is not enough time in the day or not enough attention that I can put on both of them. Is it a similar thing for you or have you found ways to just do exceedingly well at both?
Danny Johnson: I’m with you. I think I just talked to somebody recently actually that I had the same question for, because they were telling me all these things that they just set up and they were doing. And I was like, “How the heck do you do that and still have any kind of life at all?” I’ll give my answer, but I want to give his too because I liked his.
I think there’s two perspectives or two ways to go about it. His was “I set things up to the point where I’m doing just the things that I do best at. And I’ve got other people kind of taking the reins when everything else. So, they’re only doing one piece of these different things”.
I still think for myself, and the reason why my answer is different is because for me it wasn’t like that. Even if I wasn’t so involved in something, even when I did have the whole team doing the house business, I was spending literally maybe half an hour or one hour a week for that whole business. But mentally it still was this thing that was just there all the time that I was worrying about subconsciously. And it was like this thing, I was still juggling, even though I wasn’t.
I had to actually have a conversation with the guy here that’s pretty successful in San Antonio that I met. A lot of times as entrepreneurs, we set up these things and all of them are like our babies. They’re literally like our children, our babies, and we don’t want to neglect them. We don’t want to let them die out. And sometimes we’re collecting them rather than doing something with it and the interest as it wanes or whatever, things need to change up. Either it needs to go on to somebody that’s willing to nurture it, take care of it or figure something out. But we just can’t take care of 20 babies. It’s not going to be good.
So, for me to keep walking me through, he said “Name all the things that you’re working on right now. And I don’t want you to spend more than a second answering after I say each one of these things. So, you repeat it back to me”. And he wanted me to say passionately or not, “yes” or “no” after each one of them. And I could not think about it. I just had to boom, boom, boom. And so, he did that and I was kind of shocked how many “no’s” I had. And so, since that conversation, now I’m down to where I’m working on the yeses. But anyway, that wasn’t easy and it took time.
Seth: Yeah. I’ve never heard of that. That’s a smart, simple exercise. I’m kind of scared to go through that myself.
Danny Johnson: It’s a scary one. It really is.
Danny Johnson: The only person that I know personally, who has successfully done the whole serial entrepreneurship thing, where they run multi-million-dollar businesses, it’s this guy who’s very intriguing. He will randomly spend like half a year traveling the world. It’s a very interesting guy. We should actually probably get him on the podcast. His name is LD. He just puts a new wrinkle in your brain.
But the way that he did it, because I asked him, I’m like, “How do you do all this?” He had started three businesses or something. And then, this is when I was at Simple Wholesaling and he had just started getting into real estate and buying a bunch of rental properties. And so, I was helping him sell property essentially. But the way he did it is he focused on one at a time. And essentially, metaphorically got the plate spinning. And then it was like balancing that one and then adding a new plate.
What he meant by that analogy when he was explaining it to me, was that, build a system that is self-sustaining and it has other people essentially running it. Build the system to where the plate is spinning on its own. And then once you get it to that point then you can bring something else on, but you got to focus on one plate at a time and get it to the point where it has momentum, that is on its own before you bring on something else.
It’s questionable. He might just be an outlier. So, it is questionable whether or not it is possible to really have multiple businesses like that, but it is possible. I think it’s dependent on having incredible systems.
Danny Johnson: I have a problem with feeling like something is never perfect enough. So, it’s like, “get it spinning” when my definition of it is spinning, I don’t know if I’ll ever have it where I feel like, “Yeah, I’ve got it to where I want it”. It’s like always another level up.
Seth: I’m familiar with that as well. Danny, have you ever taken the Enneagram test?
Danny Johnson: Yes. But I don’t remember what I got.
Seth: Oh, that’s helpful. Thanks for nothing. I was just wondering if maybe you were the type one, perfectionist, just given what you just said about it’s never perfect enough. But my thoughts about LD and his situation and really anybody who wants to be a serial entrepreneur is almost to think about, “What is the purpose of this business? Is this a mission-driven business where I’m trying to do something for the world? Or is this just about making money? Is that what it boils down to? Or is it, I just love this activity so much. I would do it for free”. Why? Why do you need so many businesses? Why not just focus on one?
And there’s not really a wrong answer to that, but it could be the kind of thing whereas some people are the hunter types, where they just love the thrill of starting something new in the thrill of the chase, but it gets old really quick and they don’t actually want to let go the distance. And maybe they don’t have to, if they know how to offload all the jobs to somebody else. I apparently have a really hard time with that. But maybe it’s just a deeper, fundamental question to ask before starting anything. It’s like, “Why? What is this going to serve?”
Jaren: Yeah. Good point there, Seth. I feel like this entire podcast is pointing out problems with absolutely no solution. So, it’s good though. I’m pretty good at problems.
Seth: Cool. Is there anything we should touch on Danny before we hit into our final three questions to close this out? Have we covered all the important stuff that we should?
Danny Johnson: Yeah. So, I’m starting a new podcast. I’ve run Flipping Junkie for, man, what? Five years now, 200 episodes. That’s geared towards the whole house flipping and newer investors, which is great. But I wanted to have something that went a little bit deeper, broader. And so, looking at what we were talking about today, where a lot of us are running the businesses. Don’t take the step to get those people in, to help actually manage it so that we do free up our time to have the lifestyles that we really want to have.
The whole podcast is about looking at “What are the fears there and what are we avoiding?” That’s the important thing. It’s looking at “What are you avoiding?” All of us are avoiding something at any given time with regard to our lives. And it’s like, “What are we avoiding? What’s causing that?” And that’s what I want to dig into. There was something Jordan Peterson had said something that really stuck with me. He talked about everybody’s got a fear or fears. Everybody’s afraid of some things. And it’s not that we lose that fear or the fear goes away, or we conquer the fear. It’s that we get braver, that we show up and we go through it. And the fear is still there, but we’ve become braver and we’ve been willing to work through it.
And so, it was an interesting thing and he goes into detail with it, to where it does that. But I like that a lot. So, the name of the podcast is just going to be “Braver”, The Braver Podcast. It’s focused on real estate in general, but it’s going to be more geared towards the fears and leadership, hiring, motivation, stuff I want to talk about.
Seth: Yeah. That fear thing is an interesting dilemma. I heard somebody not long ago talking about how a lot of us will pay money to go to an amusement park and ride roller coasters or go skydiving or go bungee jumping almost because of the fear of the risk of death or just it’s this thrill. So, that’s one kind of fear that a lot of people just intentionally go and run after, but then there’s other kinds of fear that people are just tormented by, they lose sleep at night over it. And there’s different kinds of fear. And fear does sort of serve a purpose in terms of survival and that kind of thing.
But there is a point where a fear, it just doesn’t do anything but destroy and just mess up your opportunities and your mindset and keep it from going out for things you really should be going after to the extent that a person can identify, “What kind of fear is this? Is this the self-sabotage kind of fear? Or is this the kind of fear that would be fun to run after?”
Danny Johnson: Yeah. I like looking at that. And sometimes we’re dancing around something. We’re doing something that is not helpful for us in our business. And if I could go back to the example of an employee that I feel like is not having enough to do, and I can go and I can do all these things, well, that’s sort of the symptom of the problem. The problem is more of something else behind the scenes that has to do with me. And it’s just the kind of work on myself that needs to be done. But anyway, yeah, we could talk for a week, go for another couple hours.
Seth: Danny, when I had you on the podcast, I think it was like a couple of years ago now, we weren’t doing this thing where we were asking these final three questions. So, this should be new to you. At the end of not every podcast, but most of them these days we ask three questions of our guests. It has nothing to do with real estate or anything like that, just to kind of figure out how that person ticks and how they think. So, speaking of fear, the first question is what is your biggest fear?
Danny Johnson: Missing out on life the way I want to live it. Or being too busy, doing too much of one thing or too much business. I’m looking back and saying, “Man, I wish I would’ve taken more time to do these other things when I was younger” kind of stuff like that. Yeah, I think that drives a lot of what I’m working hard on right now.
Jaren: Yeah. That’s a big one. What is something you’re most proud of?
Danny Johnson: I want to say that the things that were built, but it’s more than that. I think it’s the teams and what we’ve built together. We’ve had success in business and even in the software, but it’s really getting that to where it’s a vision and then you’ve got people behind it and creating something that we’re all kind of a part of. I think I’m most proud of that. Yeah.
Seth: That’s definitely something to be proud of. Building a team where everybody’s on the same page or close to it, working toward a common goal and the right people in the right seats. That’s a huge accomplishment. So, what is the most important lesson you have ever learned?
Danny Johnson: I’m not my work. This realization that really what happens with anything that I’m working on is not me. It’s like, if something goes really well or doesn’t go well, or whatever has nothing to do with who I am. All this stuff is not me. And what I am is more. I don’t know. It’s more of a spiritual kind of answer, I think.
Seth: Yeah. So, what are you then, if you’re not your work? I think that’s a great answer by the way, but just prompts me to ask you.
Danny Johnson: I will give you the spiritual answer. I am the being that is aware. I am my awareness. I’m playing a role as a human and all that. It’s a spiritual answer. I don’t know. It’s the first time I’ve talked about this kind of thing. So, it feels a little bit weird sharing that, but it’s kind of a detachment from the things that keep the ego-driven stuff going.
Jaren: I like that. I am awareness. I like that a lot.
Seth: Well, Dan, I appreciate you coming on the podcast again, a couple of years later. So, if people want to find out more about you, I know you mentioned Flipping Junkie. Any other place they should go? By the way, everything Danny mentions here, I’m going to include in the show notes for this episode, retipster.com/106.
Danny Johnson: Yeah. Thank you so much for having me on the show. If anybody wants to reach out, you can just email me just because I used to say here’s a website, but really then how do you contact page? It doesn’t seem very connecting. But my email address is email@example.com. So, just email me directly. That’ll go directly to me, firstname.lastname@example.org. And then the new podcast, if you’re interested in listening to more of those things, it is going to be at braver.fm. And that’ll probably be up by the time this episode gets published. So, braver.fm.
Seth: So, there you go, folks, that was our conversation with Danny Johnson. I hope you guys enjoyed it. Do you have any favorite moments or takeaways from that, Jaren?
Jaren: Yeah, man. I thought that it was just really good to identify some of the problems that you face as an entrepreneur. You guys are, in my mind, kind of veterans in a lot of ways on small business and navigating the ship in the waters of entrepreneurship and stuff.
And it was just really insightful to see that you guys don’t have it all figured out and you guys have your own questions that you’re trying to solve. I just thought that was really refreshing. Hopefully, for other people that are listening out there, I think that they can see they’re not alone in trying to figure out all these things. Because there’s just not a “one size fits all” solution to a lot of this stuff.
Again, I like the analogy of being a captain of a ship and navigating waters because you know your stuff and you have a high level of competency, just like a captain of a ship does, but there’s always things that you’re learning and there’s always things that can happen. You can have a really bad storm or you can hit waters that are really shallow or whatever, and you have to kind of take it as it comes and roll with the punches and figure things out on the fly. And I just think that you guys really highlighted that in today’s conversation. So, that was good.
Seth: Thanks, man. Yeah, I agree. It’s always good to talk to somebody with his level of experience and just figure out different things that he’s seen work and other things that he also doesn’t fully know yet. And just to kind of see it’s okay, it’s okay to not have all the answers and we’re all kind of in the same boat in terms of finding what works. Some of us won’t really admit that, will just kind of portray that we have it all figured out, but man, I certainly don’t.
Jaren: Yeah, a hundred percent. And the older I get, the more I find out that people who tend to present themselves as having to figure it all out over time, a lot of times they end up having some crazy moral failure or some public thing that pops up. And it just seems the more and more I’m around, the more and more behind closed doors people are just like me. They’re struggling just like me.
Seth: Yeah. It’s kind of funny putting off this image that you don’t have faults or you’re the ultimate human being or something. And that puts a lot of pressure on you. I don’t know how people do that. Maybe some people are really good at that. Maybe they can handle the pressure, but I don’t know, I would feel like I’m acting or living a double life or faking it. It would feel almost stressful.
Jaren: Yeah. But with leadership, it kind of comes with the territory. Leadership is a tough gig, man, because you grow in influence and you grow in leadership and it’s an honor to be a leader. And there’s a lot of perks that come with being a leader, but leadership is pretty lonely. And the more influence you have, the more it’s almost like you have to put up that façade.
Because I tend to go back to this analogy of a general going into a battle tomorrow that has a very high chance of nobody surviving cannot be honest and be like, “I’m afraid I’m going to die.” That would destroy any chance of survival immediately. So, he has to put a bold face on it and he has to fake it, I guess to lie, and be like, “It’s going to be great. We’re going to crush the enemy.” And maybe he believes that, maybe he makes himself up or whatever.
But if he is in a situation where his true emotional state is like, “I’m freaking out and I’m overwhelmed. And I think I’m going to die tomorrow,” he’s not in a position to be weak. He can’t. There’s nobody that he can be vulnerable to, and he doesn’t have a shoulder to cry on. He has to step it up and be the leader and be the hero. That’s a lot of pressure.
I think the solution to that, at least this is kind of a running hypothesis, is as you grow in leadership, it’s important to have a small group of people in your life that you can be vulnerable with and that you can really trust. And if you are struggling with something or you are dropping the ball, you think you’re going to die tomorrow or whatever because you’re facing a battle, it’s good to have those people in your life because you need them.
But for the majority of people in your life and for the people that you’re leading, there is this weird tension that you have to walk where it’s like, you have to be vulnerable. And you have to be honest and show that you’re human and make mistakes. Because that’s all approachable and all beneficial for leading people well.
But there’s also this other side where you can’t be too vulnerable because if you’re too emotional or too weak or too stressed out or whatever people are going to make, “Dude, I don’t know, why would I follow you? You’re not successful.” Just practically, because myself included, I want to follow somebody who has the results and is continuing to get the results that I want in my life. So, if they’re struggling to continue to get results, it’s like, “Well, am I going to follow them? Probably not.”
Seth: That’s the thing though, because shouldn’t the person who’s following have the benefit of knowledge if the person does not actually have success? You’re almost kind of like doing that person a disservice by saying, “Hey, maybe you shouldn’t follow me.” You should be fully informed about my experience before you decide whether or not to follow me, but now you’re going to hide it. Or you are going to play it up like you’re something you’re not. And then a person could be falling right off a cliff because they don’t know that you don’t really know what you’re talking about.
Jaren: Yeah. In that context, it’s tough because you are right. Integrity would look like being honest there. But you would also lose your influence because you’re not getting the results. So, you have to kind of always be on this constant hamster wheel of being the expert or being the guy that has it figured out and is creating new strategies or innovation. It can get tough, man. A lot of super high-level influencers are lonely.
Seth: It sort of seems like there are different levels of this though. If you’re talking about a military situation where you’re leading people into battle and people have to work together, that’s a very different thing than being a fake influencer who’s just lying about everything until they get people to follow you.
Jaren: Thousand percent. And I don’t think that you should be a fake influencer at all. I don’t think that anybody should aspire to be that. And if you have, if you’re doing that because you want the accolades, then I think it speaks to a deeper issue that you got to get figured out. Like getting improved by others and all that. But there are different degrees of vulnerability that you can have, or that you should have, depending on what context you’re in, whether it’s business or family or it is even ministry non-profit stuff. It just all depends.
Seth: All right. Well, with that Jaren, let’s move on to our final little question that we do here. So, the question is this. What is the dumbest way you have ever been injured?
Jaren: Oh, man.
Seth: I’ve got a pretty good off the top of my head, if you need time to think. So, for me, this has happened back in, I think it was 2012. I was carrying this big box of files down a flight of stairs. And the stairs were oddly spaced out. They weren’t like normal, typical flights of stairs. They were longer than they were tall. I missed the last stair because I literally couldn’t see it because I had a box in front of me.
This was at work. And so, I tripped down, fell and I totally screwed up my ankle. It hurt horribly. And there was a lady running right in front of me. I basically smacked right into her. And she was like, “Oh my, are you okay?” And I tried to get up and play it off like it was nothing and just kept going on.
And that night I got home and my foot was the nastiest. It was just all red and purple. Something horrible happened inside my ankle. And it always felt weird for a long time after that. And about two years later, I finally went to the doctor, an orthopedic surgeon. I was like, “Something is wrong with my ankle. Can you look at it?” And he could tell immediately, “Yeah, this is really loose. Something’s not right.”
It turned out I had broken a couple of ligaments. I think two or three ligaments. I had to have a huge surgery to fix it all. And my ankle has never been the same since. But all this just from walking down a flight of stairs with a box in front of me. That’s mine.
Jaren: Wow. That does sound very stupid. And it just sounds really traumatic.
Seth: Well, I think it was dumb in that all I had to do was just put my foot in the right place. I didn’t have to have that huge multi-year surgery-inducing thing.
Jaren: Well, I’ll tell you, mine is much dumber. I graduated from high school. I didn’t graduate from college, but I did do my freshman year at a University in Cleveland, Tennessee called Lee University. So, I was there for a year. And while there one time it snowed and there was a bunch of ice on the ground. At this point, the snow had kind of melted, but they’re still like bundles of snow, like little piles of snow.
And for whatever reason, I just had it in my head that I was going to be like, “There is going to be super cool for me to just walk up in front of a bunch of people and just kick this big pile of snow”. And you know how it is when you’re like 17, 18 years old. I graduated high school when I was 17. So, I was probably 18 at that time, but I was really young.
And so, I walked up and I just reel back my leg as far as the candidate goes whack. And I kick this thing with my full force and it’s a block of ice. Like it is not snow. It is as hard as you can possibly get. And my foot hurt, man. If I remember correctly, I think I had to get crutches. I don’t think I broke anything. I could be making up the crutches part, but I know I was limping around for a really long time, like for a few weeks after. And it was extremely painful.
Seth: Wow, was it bruised or something?
Jaren: Yeah. The top of my foot was just hurt, man. Even to the touch, I was throbbing. That was probably one of the stupidest things. Why would anybody think it’s cool for me to just kick this big old chunk of snow?
Seth: I actually did something not that dissimilar from that when I was in Mexico in high school. There was this manhole cover that was made of concrete, but it tilted it up just a little bit. So, it wasn’t squarely flush on the whole. It was like somebody had moved it and I was going to try to use my heel to kick it backward to cover it up. And so, I did a big old windup and hit it with the back of my heel and it didn’t move at all. It hurt so bad. So, you’re not alone. Although I must say I was actually trying to accomplish something with my example.
Jaren: Yeah. I was just being impulsive. Just a thought hit my brain and my body reacted.
Seth: Okay. So, if you guys want to check out the show notes again, retipster.com/106 because this is episode 106. And if you want to text the word “FREE” to the number 33777 I encourage you to do that and I’ll let you find out what happens after you do that. Thanks again for listening. I hope you guys got a lot out of our conversation with Danny and we’ll talk to you next time.