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We recently had the honor of interviewing Ajay Sharma.
Ajay has been a vacant land investor for nearly two years. He started the way most of us do, flipping land as a part-time gig shortly after graduating from Indiana University. He got some early wins that propelled him to the point of being able to quit his job about 18 months after he started. Ajay now gets to work full time from his desk in downtown Chicago. And get this… the guy is just 24 years old!
Ajay will tell us his story and explain some key events, decisions, people, and mindset shifts that enabled him to get to where he is.
Links and Resources
- Ajay's Instagram Profile
- Rich Dad Poor Dad by Robert Kiyosaki
- 7 Ways to Make $1,000 Per Month From Land
- Land Investing Masterclass
- Everything You Need to Know About Getting Your County's ‘Delinquent Tax List'
- Simple Real Estate Postcard Templates That Work
- Can't Hurt Me by David Goggins
- 052: How to Sell Land Fast (Without Driving Yourself Crazy)
- 122: How to 10X Your Land Investing Revenue w/ Travis King
- 132: How Land Investors Can Use 21st Century Marketing Techniques w/ Callan Faulkner
- 082: How to Rezone Properties for Huge Profits w/ Mike Marshall
- How Land Specialized Real Estate Agents Can Change the Game for Land Investors
- What Are ‘Dispositions' in Real Estate?
- OpenPhone (REtipster Affiliate Link)
- 135: $1-3 Million Per Month in the Land Business w/ Doug Smith
- Pebble (REtipster Affiliate Link)
- Launch Control
- REI Call Center
- Traction by Gino Wickman
- Steve Trang's Real Estate Disruptors
- 119: How Jesse Finds the Best Options for Buying Vacant Land
- PATLive Review: How Helpful Is a Virtual Receptionist for Busy Entrepreneurs?
- PATLive (REtipster Affiliate Link)
Seth: Hey everybody, how's it going? This is Seth and Jaren, and you're listening to the REtipster podcast.
Today we have the honor of interviewing Ajay Sharma. Ajay has been a vacant land investor for nearly two years now. He started part-time shortly after graduating college at Indiana University, and he got some early wins to propel him into being able to quit his job about 18 months after he started.
Ajay now gets to work full time from his desk in downtown Chicago. And get this… The guy is just 24 years old. Jaren is actually pretty good friends with Ajay. They know each other pretty well. And I just met Ajay at a conference earlier this year. And just in my brief interaction with him, I could tell within like two minutes, this guy has a very bright future ahead of him.
So, Ajay, welcome to the show. How are you doing?
Ajay: Thanks so much for that introduction, Seth. I am living the dream. It's an honor to be here guys.
Jaren: Yeah, man. It's an honor to have you.
Seth: Ajay, you probably remember this. I think it was in our first conversation ever. I was like, man, we got to get you on the podcast because I was just kind of blown away by the things that I've heard that you're doing and how far you've gotten in such a short amount of time. So, I'm really excited for this.
Jaren: I think I had a similar conversation very quickly after meeting you as well.
Ajay: Yeah, yeah. I remember these conversations and I held off for a bit just because I wanted to mentally prepare myself, had to psych myself up.
Seth: Yeah, totally. I get that.
Jaren: I think maybe to kick this conversation off, let's start with your real estate origin story. How did you first hear about land and then how did you ultimately get started?
Ajay: Yeah, good question. If we go way back into the beginning time. I remember as a junior in college, thinking just about my future, careers, wealth, all that fun stuff. And I stumbled across a book that you guys have maybe heard of Rich Dad Poor Dad by Robert Kiyosaki.
Seth: Ah, I've never heard of that one.
Jaren: I should write that one now.
Ajay: Well, it spawned into an interest of real estate. And started binging BiggerPockets, which I feel like everyone's pretty familiar with. As I got into BiggerPockets, I knew I wanted to get into real estate eventually. Fast forward a couple years, I had my first full-time job out of college. I still hadn't started anything out of real estate, but I had a good job. I was making a good amount of money. Didn't have any debt thankfully. And so, two, three months into my job, I'm thinking, “All right, it's time, let's start buying properties. Let's start building up wealth, passive income.” All this fun stuff.
And I finally started analyzing properties. I'm looking at markets and even cheaper markets. If you're wanting to buy, let's say, a single-family home in Northwest Indiana or Southern Wisconsin, you're looking at a duplex for $140,000 to $150,000. 20% down on that is still a pretty considerable chunk of change when you're looking. So, I thought, okay, my two options here are save and wait, which again, I had a good job, but it wasn't like I was pocketing $20,000 a month.
And then you could go raise capital. Well, in my mind, I was not comfortable raising private capital at a place where I couldn't actually tell an investor how their investment was going to perform. I can't say, “Hey, this is going to give you a 12% return” when this isn't anything I've done before. I can read all the books and listen to the podcasts and watch the YouTube videos. But at the end of the day…
Jaren: Good on you for having integrity. Because not a lot of people… People will go all around saying that. They promised the world on the silver platter and they can't perform. So at least you had integrity. That's a good one.
Ajay: I appreciate that. Like I said, yeah, it scared me too. I sleep very well at night the way I invest now. And I wasn't looking at changing that up. And so thankfully the mighty YouTube algorithm pitched me a video from REtipster. It was like seven ways you can make a thousand dollars or so in passive income, if you remember that video guys.
Seth: I remember that.
Ajay: I watched it and was like, “Huh? Land investing?” Not even a niche I was familiar with, I had ever heard of. And I just started binging REtipster. I mean that night I went for a walk and I was listening to stuff at probably 1.5 times speed. By the end of the night, it was 10:30 PM. I think I had gotten through like eight or nine episodes or something crazy. I would just be plowing through this stuff. And I was like, “Okay, I think I know enough that this is something I want to try out.”
So, that night I bought the course. About a week later, I had my website set up, a phone number, a mailbox and said, “Okay, I've got enough. Let's start calling up counties, getting these tax delinquent lists.” I feel like that's where everybody's got to start, but I got lucky in it. In my first I think three counties I had hit up, I got hit with a small town in Wisconsin, a nice older gentleman that had quite a bit of acreage. Ended up just picking up one of his parcels. $2,000 was the purchase price. There were about $1,100 in back taxes. There's some junk on there I had to get hauled off.
And so, miscellaneous costs, that was all in at about $3,500. I got pretty lucky, had found just the cream of the crop realtor in the area, a sixth-generation native to this town with a population of 12,000 people. She knew everyone. Before we had hit the market, she had six buyers lined up.
And again, I'm 22 at this point. I had never paid $3,500 for anything in my life. This is a lot of money. But having the assurance to make that decision and then we ended up selling it for about $15,000 shortly thereafter. After I'd paid the realtor and title fees, I netted about $9,000 and knew, “Okay, there's something here, let's dive into this.”
And all this was in a span of probably about six weeks. I think I had bought the course either August 31st or September 1st of 2020. And then it was October 8th that I purchased this property. These dates stick in my head, because there were such big moments for me. About three weeks after that though, we had sold the property and it was an awesome quick win to fuel some momentum.
Seth: Wow. Just to confirm, when you say you bought this course, you're talking about the Land Investing Masterclass?
Ajay: Yes. Yeah, that's the one I'm talking about.
Seth: I just wanted to make sure. I wanted to be happy for myself. Sweet, man. That's awesome. For a first deal, that is a slam dunk. That's really exciting.
Ajay: No kidding.
Seth: If I remember right, was that the one that turned into more deals in the future or something?
Ajay: Absolutely. Time went on. I think I had gotten about five deals under my belt at this point. I'll actually take a step back. It's funny. This deal set me up for… I want to call it failure, but let's just say I had very poor expectations for how the land business worked because I think I had sent out about 150 yellow postcards to get this deal. And so, in my mind I'm like, wow, send out $75 worth of postcards, make $9,000. We are going to be so rich so fast.
Well, unfortunately, that expectation meant I sent out not nearly enough marketing to get my next deal until about February is when I had my next buy. I had a good early win and then it took me four months to get into more traction. I remember vividly telling myself you are not going to be a one-hit wonder. You were going to figure this out. You are going to make it work. And so, it wasn't until June. I think at that point I had five or six deals under my belt.
I was out to dinner with one of my best friends from high school and his parents. And they had actually just downsized their home. And I told my good friend what I was doing and he had mentioned it to his parents and they were like, “Oh, well we actually just downsized. We're sitting on a little bit over six figures in cash. Can you do anything with it?” And again, guys, I'd done like four or five deals at this point, right? That's a mind-boggling number to… I think I maybe just turned 23 at this point. I’ve done five deals. I was still working full time. I was like, I don't even know how I would structure this, what I would do, how to find a deal that's worth this much. Because I don't think I'd purchased anything under $10,000 at that point. And I don't think I had sold anything over $35,000 at this point.
I had no idea how to deploy that much capital. And then a light bulb went off. “Huh? I wonder if the rest of this acreage is still for sale.” So, I actually called this seller back up to see if he was still interested in selling. And I honestly think he was willing to work with me, by the grace of God. I had heard through the grapevine that several other people had approached him, neighbors, local investors. He just didn't trust anyone. I really think God had softened his heart to let down some walls and be vulnerable to me and trusted me. And so, we got back on the phone, he said what he wanted. He said he wanted a thousand acres. He had 113 acres. So, I offered him about $110,000. He agreed to it.
And I raised some private capital. My friends actually took out a personal loan, which I wouldn't recommend to other people. But again, I had a lot of confidence in this deal. I just piled the rest of my cash into this. I had an embarrassingly low amount of cash for a short period of time because I just put all my chips into this deal.
We had bought it for $110,000, ended up selling it in two chunks. One at $350,000 and at $100,000. That's life-changing money very, very quickly. Again, not all of that went into my pocket. I had private investors, I had debt. I had to pay stuff off. There were attorney fees involved and a lot of other stuff, but regardless was just a catapult for me, being able to invest in the business. I was able to confidently put money into more marketing, higher coaches and really get the ball rolling. So, yeah. It was a really fun kind of boomerang story to go back to this.
Seth: Imagine if you had just been a one-hit wonder. You got the first win, you couldn't figure it out. “Oh, that doesn't work. I'm done.” I don’t know. It's just crazy, those moments of opportunity in life when you can pick which road you want to go down. And a lot of that has to do with your beliefs, I think. If you believe that this works or believe that it doesn't, whatever you believe, that's going to be the truth.
Ajay: Right. And I actually wanted to make a quick note on that because I remember when we had that first conversation, me and the seller, he was interested in selling all of his acreage. And I had told myself that again, limiting beliefs. I had told myself that I couldn't pull that off. And it was my first deal again. So, we had the whole factor of, “I don't know how this will return, blah, blah, blah.” And I was more comfortable using my own capital.
But I think your listeners might benefit from hearing you can only make as much as you let yourself. And that's a really interesting statement there, but I believe it with my whole heart I told myself I couldn't make that amount. It wasn't feasible in my brain to actually capture that amount of equity and then go forth and sell that deal.
And so, really thinking about, “Well, there's not really a ceiling, right?” We live in a capitalist society. Love it, hate it, whatever you want, the fact of the matter is we live in capitalist society and it's up to you whether you want to capitalize on that. But you need to let yourself believe that you can make a certain amount before you go make that amount. And if you don't, it probably won't happen.
It's Brandon Turner who talks about how success is never a surprise. You never wake up one day and say, “Oh my gosh, I've got washboard abs.” Right? It's the same idea and philosophy when it comes to…
Seth: That would be awesome.
Jaren: That would be awesome.
Ajay: But it's the same thing with investing. I don't know a single millionaire that woke up one day and said, “Oh, hey, look at that. We're millionaires.” It came from consistency, discipline, hard work, intention, focus. And so, yeah, just a really good lesson that I've picked up myself over these past two years.
Jaren: Yeah. It's really interesting that you bring that up because I'll be very vague in my description here because I don't want to give away private information about people. But one of my tenants happens to make some good money so much that he wouldn't need to rent, but he still rents (or she). I might be changing the gender on you guys to be more incognito.
What's interesting is that I've noticed, my sister has a boyfriend-turned-fiancé at some point who refused to have a bank account. He would only take his check from work. He would have it in, he'd go and cash it. He'd keep everything in cash. And I think that a lot of these limiting practices or these limiting beliefs really do hinge on mindset. If you approach life small-minded or thinking like that you don't deserve, or you're not good enough or capable, then you are what you actually think. There are a lot of different versions of that. “What a man thinks so is he,” Napoleon Hill. There are so many versions of this.
But actually, if you're going to do this, I feel like every investor needs to be optimistic about the future. Like all this stuff about the economy and all this fear and all this stuff is like guys, if you're literally going to be investing, you should be by default biased towards an optimistic feature because what's the point otherwise? What are you doing? I don't know where I was going with that, but I really liked what you said there.
Seth: To add on that though. I forget where I was reading this the other day, but just to illustrate that point even further because I think a lot of us have heard that. Like “You are what you believe or your thoughts guide your life.” All this stuff, which is true. But I was thinking, “What are some crazy things people do that they dobecause of their beliefs?” People go to war because of beliefs. People commit suicide because of beliefs. People succeed and fail. People choose careers, spouses, everything is your beliefs. That's what it comes down to.
When I kind of read those examples of really life-changing and life-ending things sometimes that people do because of what they believe. It's like, “Wow, it's really important to examine my beliefs and not just be a victim of whatever I'm feeling, but really understand why do I believe that?”
I think that the tricky thing about that for me is that I can believe that I can fly, but I can't fly. I can believe all kinds of stupid things too. So, it's like, it's not that cut-and-dry. And so, I think that's where you have to sort of look at it from, “What are just the cold hard facts? What is reality? And where do my beliefs fit into that?” Almost when you look at a floor that isn't leveled and you pour a leveling compound on it. Your beliefs are that leveling compound, like it expands to fit this situation.
Whereas if you were to just put a rock on the ground and it just falls where it is, it doesn't go anywhere. It is rigid. It's not going to level anything out, but a leveling compound that expands to wherever it needs to, to make it level, make it work.
Jaren: Yeah, I really appreciate you bringing up that counterpoint because it is very true. And I don't know where the line is because I think even David Goggins, I don't know if you guys have read David Goggins's book, but he actually opens the book where he's sitting around with a bunch of college professors that are these research professors that are talking about mental toughness. And they're like, “There is a cap, there is a limit to mental toughness. The body has physical limitations.” And then they asked David what his thoughts were. And he is like, “Well, I wasn't going to say anything, but I know I'm not going to turn away from a point-blank question.” So, he just said, “Well, it's something to be said for something to be theorized versus something lived. And I lived it.”
And so, I don't know where the line is, but I do know that there is fruit from having a line to some degree. For example, I've recently come to terms with the fact that I need to sleep at night. All-nighters do not work. And no matter how much I push… Yeah, it's 30 years in. 31 years in, I just had a birthday actually. That's a primary example. There's a clear limiting physical imitation on functioning without sleep that's going to have very, very negative consequences if you don't meet that requirement.
I know there's a line somewhere and it's very helpful. It's good to be realistic. Like, yo, I'm not going to go become an NBA player at 31 years old with my life. it's not going to happen. So, maybe I love basketball and I can go become like a rec coach or something and have it be a part of my life, but I'm not going to go be one of the stars. So, I think it's healthy to have that counterbalance to it.
But where is the line? Because the whole point of belief is to combat limitations.
Ajay: Just to add to that, we keep talking about the line. I think that's the game. It’s pushing that line to say, “Well, can I do this?” I'm a really big fan of the Mamba Mentality, Kobe Bryant. I keep telling myself that I'm 24. So, this is my Mamba year. And it's like, okay, where, where is that line? What's the cap?
And as business people, I think it's really easy to quantify your success in terms of dollars. I think Mark Cuban says that it's not about, “I have money, this that as much as dollars are the success metric in a business. Your performance is based on that dollar amount, whether it's free cash flow, profit, whatever you want to call it.”
And so, in my mind, I often think, well, someone else is doing this. Somebody else is making that amount. So, I know there's not a physical limitation. It's a shortage of either resources or information. And then the game is “Okay, how do I get there as fast as possible?” Because we know that we are mortal unfortunately or fortunately, whichever way you want to look at it.
Jaren: I have my doubts about Seth.
Seth: Oh, I'm definitely mortal.
Ajay: But yeah, this discussion just kind of excites me because it's like, “Well, where is that line? I don't know. Let's find out and let's just keep pushing it.” And that changes as time goes on and your constraints change. Like I’ll probably have different constraints at age 75.
Jaren: Your strength increases.
Ajay: Yeah, absolutely. Fun game to play.
Seth: Another way to look at that almost from another angle is, at some point we are all settling for something. We are accepting the fact that it doesn't get better than this. So, I'm going to stop. Whether that's the business or the job you have, at what point am I saying, “Okay, it doesn't get better than this, or I can't do better or it's not worth working harder to do better?” And is that inherently a bad thing? Or is it just like, “Nope, I'm choosing to end the battle here?” So, good to go.
Jaren: I think that being content is the arch nemesis of drive, though. If you're wanting to be an ambitious person, it's very interesting. I've been getting a lot of life out of listening to Jewish rabbis of all things recently. And that's one of the things that they talk about. At least I've heard that theme brought up quite a bit. It's like, there's this tension, because if you want to make a lot of money, you don't really want to be content because you need to have that hunger to push through. Because if you're content, you're not hungry. You're like you want to go take a nap and enjoy the backyard.
So, it's a totally different mindset. It's this weird tension of how do you live in this place of gratefulness and gratitude, but also this perpetual, there's more, there's more? And it's not necessarily greed, it can be, but I feel like that's a really weird avenue to come at it from. I think it's more “I want to improve. I want to become better in every area.” So, if it's financially, the metric is money, but if it's spiritually, it's something else, or if it's physical or whatever.
I think that's how I'm kind of wired. Good, bad, and ugly, my Achilles heel and probably my superpower is that I just am incessant about wanting to get better. I think that's the key to success. I don’t know. I'd love to hear your guy’s thoughts. I know I kind of went on a tangent there, but I thought it was a good one.
Seth: Yeah. I think all betterment of humanity is driven by that kind of attitude. People who think it can be better and are willing to try and are willing to fail at it. But on the same coin, you'll never really get there. You're never going to achieve that perfect state where everything is as it should be.
So, it's just a question of, “How hard do you want to work at this? We know we'll never get there, but we can probably do better than we are now. When is it good enough?” And maybe it's that point of equilibrium where you've pushed your own abilities as far as they can go and you've found all the people and they've done everything they can do. And it's acceptable. I don't know.
Ajay: I think that's where we can get into, like Gary V is always talking about loving the process. And how an end result doesn't even necessarily need to be a thought. Now don't get me wrong. You should have goals so that you have metrics and KPIs to track against so you know you're working towards something, but it's not as much as “Oh my gosh, I crossed a dollar threshold. Life is done. It's over. That was it.” As much as it is “I love playing this game. Let's wake up every day and have fun running this business, doing this thing, hanging out with my family, writing a book.” Whatever it is for you.
But if you truly love the game that you're playing, then there's almost an element of “You want to get better at the game and you love getting better at the game.” And life is just this fun journey the whole time.
And that's how it's felt for me. Since I've been able to go full-time, I'm not sure at this angle, if we can see it or not, but I've got a whiteboard to my right here. And I can't tell you the amount of fun I have when it is just a blank whiteboard and I've got these ideas in my brain and I get to bring them to some form of reality. And it's a big nerd thing, but it is a ton of fun. I have a true blast just getting to plot this stuff out. So right now, I’m loving the process.
Jaren: Well, I think that's actually a good segue to one of the questions that I wanted to ask you just about your background as a kid. I'm just curious, were you entrepreneurial, were you the guy that was selling candy in high school and stuff, or did land just light the fire for you?
Ajay: Yeah. Good question. I'll say a couple of things about that. Number one, I think my earliest venture that I can remember was in elementary school. I grew up in Southern Indiana and summers would get kind of hot. School started in August. It was still pretty hot. And I remember a vivid recess where it was probably like 110 in humid. So, just sticky and gross. The kids just weren't having fun. I say the kids, I was one of them. I was probably nine at the time. The playground was made of mulch, like tire mulch, not wood chip or manure mulch. Very relevant to the story.
I remember thinking, “Okay, let's make some shade.” And I had basically built a fort out of mulch using various pieces of the playground and an absurd amount of mulch. I don't know how I did this in our 30-minute recess. But I created this, and called it the Shady Shack, and actually started charging students at recess $2 a pop to get to enjoy the Shady Shack. We got shut down very quickly.
Seth: Did you make any sales?
Ajay: I think I got like $6 out of it or something. It was awesome. And I tried rebuilding it the rest of the week and the teachers just were not happy with me, but that's kind of the earliest venture that I remember.
Aside from that, I come from a family of entrepreneurs. Down in Indiana, we ran a gas station down there. And as early as I can remember I was working the cash register. I was dealing with cash and programming our POS system point of sale and looking at margins and how much we are making on this gas shipment this much versus this versus that. And it was fun. It was really fun to look at this stuff and I'd always been into math and into numbers, but I was exposed to entrepreneurship at a very early age.
And so, in my subconscious, I was programmed to believe that you should have control over your income. And as I got older, and then got to the salary position again, a phenomenal job working with great people, good work-life balance. I enjoyed what I was doing to some extent, but I hated with conviction that I couldn't control my earnings. Even if I went and sold work to some massive client given it is professional services, I was doing tech consulting. If I were to go sell like a million-dollar project, at my level, I wouldn't get a penny of it. It was like, well, what's the motivation?
And so, looking back on it in hindsight, maybe I should have gotten a sales job or something that had more of control that you could control what you were doing, but you were kind of handed some more resources.
But I always knew I would end up in entrepreneurship. In college even I was actually an entrepreneur entrepreneurship major, which exists very seldomly. So, I'm glad I found one. Yeah. They pair it. So, they call it entrepreneurship and corporate innovation. So that you're actually marketable when you go try to get a job after college. But I always knew I was going to end up in entrepreneurship. I didn't know the timeline. I didn't know how, I didn't know when, but I knew it's what I was wired to do and what I wanted to do.
Jaren: Wow. That's awesome.
Jaren: Very cool.
Seth: On your land business today, you've been at it for a couple of years now. It sounds like you started the way most of us do, kind of just that boilerplate process of finding deals. How have things changed over the past couple of years? What are you doing today that's unique or different or what were some discoveries? Whether it be the markets you're working in, where it's just like, “Hey, you know what? There's a better way. I'm going to try this other way and do it that way now and see how that works?”
Ajay: Yeah. I'm going to talk about a couple of different things here because one of my goals with signing up to be here was I want to provide value to the audience. I want to start with just how things have changed a bit and maneuvers that I've been making to make sure my business is insulated from some form of risk.
When I got started, it was awesome. Like I said, 150 tax lingual letters to $9,000 net deal. Maybe not quite how the business was, but I do remember, I could send out about 1,100 blind offers at probably 20, 25 cents on the dollar. And I would get a deal or two from those pretty frequently.
Jaren: What market? Florida?
Ajay: Florida. Florida is really good. I would buy it $5,000, $6,000, $7,000 and sell it $25,000 to $35,000 in really good growing secondary markets around Orlando. It was kind of where I got started and got some early success and stuff. But that stopped probably later in 2021. I don't want to say stop. Sorry. It slowed down. The numbers changed. It took more volume to get there.
So, I think a couple of things have happened that have changed that. The first thing I'll say is I was doing all infill lots essentially. Despite my really big success being in some rural land for whatever reason, infill lots were just the easiest. The comps were readily available so easy to have security to go forth and actually know that you have the information to close the deal, make your return, whatever.
In infill lots, though, you have to look at a couple of different elements. Number one, a lot of wholesalers that were in house wholesaling, some education people that came in and were teaching wholesaling, basically flooded the infill lot space. And what that did, especially in markets like Florida, where so many people were moving from the East coast with the big push from COVID. DC, Boston, Maryland, New York, they like staying on their coast. So, they all came down to Florida.
So, you have this insane demand. Lots were selling like hotcakes down there, which is great. Except when people are making money, it's hard to keep it a secret. And so, these wholesalers were coming in and they were okay making $5,000 on an assignment because they basically didn't have to put any capital down. And they already had a lot of systems in place from when they were household selling.
Again, I'm not saying competition makes it so there's no opportunity, but it definitely changed the numbers on how much marketing to deal that it took. I would see markets where I was mailing and getting good deals and no joke, in like a three-to-six-month span, it was like all the feedback I'm getting is I just got an offer for four times what you're offering on a deal that I would buy at $7,000 and sell at $25,000 - $30,000. All of a sudden, they're getting offers for $20,000. And I'm like, “What? Who's making money on that?” And it's like, well, they've got a buyer's list. They're disposing of it for $5,000. They're basically not having to float capital to put into the deal. They're not spending as much on marketing because maybe they're doing cheaper means of marketing, what have you.
But it's been interesting watching that shift in terms of competition. Sorry, I like to set a bunch of assumptions before I start talking about how I've changed my strategy. So, this might be long-winded here.
The second thing I'll say is the change in interest rates has definitely affected infill lots probably more than any other class of land. I think I could be wrong here. And if anybody else wants to chime in, please message me, comment on this, whatever. I'd love to hear other people's feedback and what other people are seeing.
But I had contracts with really good builders actually that I signed in April. Interest rates started going up. We were supposed to close in June. They called me the day before closing and said, “We need a $4,000 price reduction or we're going to walk.” I'm like “What? Guys, this is not a good integrity play on your part. I mean, this is really slimy.”
But what do I do? I either take their escrow money and go remarket the deal, but maybe I needed the cash. And so, let's just go ahead and close it or I don't want to deal with it, whatever. There are timelines you've got to be aware of. But when you think about who is buying this and why they're buying it, and I think that's a really important thing everybody should pay attention to, as they're thinking about the type of land they're marketing to.
With an infill lot, you're either going directly to a retail buyer, who's going to put a home on it or you're going to a builder who's going to build it, rent it or build it, and sell it to somebody who's going to live in it. And so, regardless of where this is going, more often than not somebody who's going to get a mortgage, which means payments are going to go up.
Obviously, unless you've been living under a rock, the supply chain has been an issue. Materials have gone up. Labor has gone up over the past 18 months. So, it's this perfect storm that sucks for builders. I would hate to be a home builder right now because your costs are going up. Land has also gone up. And then all of a sudden with the interest rates going up now, your consumers can't afford to pay as much for your homes. And so, I would say that's probably the most affected type of land in the land niche.
Now in terms of what I'm doing, I'm shifting into more rural. I've got some marketing. I actually am acquiring. This is actually from another investor. Sorry, a couple of different stories here, but I'm purchasing from another investor a lot in Colorado. A 40-acre desert square. When you think about the buyer pool of that, it's got not great road access, but it has an easement.
So, who's going out there? Somebody that wants a four-wheeler, a camper, RV, whatever, camping, shooting, whatever you want to do. Your buyer pool is somebody that probably has the cash because either you're offering owner financing or you're selling it cash and there's enough of a buyer pool that's going to pay cash for it because your sales price is maybe that $25,000 to $35,000.
And there are enough people that want that product that had the cash before interest rates went up and have the cash after interest rates went up because they're buying it cash. And so, the payments don't change. You're somewhat insulated from that buyer pool under the assumption their income doesn't change. As long as this is somebody that didn't lose a job, I hope they weren’t a loan officer at Chase, for example, because I think a couple thousand of those guys just got laid off. But we're only really seeing, I don't know, this could turn into a very deep economic discussion very quickly so I want to be careful. But I would say going more rural in markets where your buyer pool is less affected is one thing you can do.
And another strategy is actually the forcing appreciation strategies. You guys have had Travis King, Mike Marshall on here. I'm working on my first subdivision project. I actually just brought in a partner who's going to be seeking out specific subdivision projects, looking at these at an individual level to see, “Hey, in this state, here are the exceptions. What can we target? Let's look at a county. Here are the 600 plots that we could look at. Let's go individually target these people.”
If you can force appreciation into the land, you're even more so insulated from risk if you're buying it at a discount of what it's worth today. Just for a number example for everybody, if let's say a lot is worth $100,000 and you force appreciation into it now it's worth $200,000 and you bought it for maybe 60 cents on the dollars.
Jaren: What strategy? Subdividing?
Ajay: Yeah. I'm so sorry. I just said forced depreciation, didn't I? Yeah. Even minor subdivisions, I'm working on a subdivision right now. It's 40 acres in Arizona. Maybe I'll talk about my actual deal instead of a hypothetical one. Because it's closer to home. I'm picking it up for $72,000. I could probably sell it today for $100,000 to $120,000 maybe. But we're cutting it up. I'm pricing it really aggressively just because I want it in out. Buying it for $72,000, $5,000 in survey fees and all that fun jazz. I've got realtors lined up and we're going to cut it up into a 20-acre and two tens. The 20 acres should sell at $75,000. The two tens should sell at $45,000 a pop. We're looking at a buy at $72,000, all in right under $80,000. We'll dispose of about $165,000.
You're doubling your numbers pretty effectively. And even if there were some kinds of correction, there are different levers you can pull all across the business. I'm looking at offering seller financing within the next three to six months if too much changes. It's a lever you can pull. And even if you're a very cash-heavy business, you can season your note for a certain period of time. And there are people in secondary markets that buy notes. And so, you can still create somewhat of a cash business as long as you're okay with the delayed gratification of building out a process where you're getting the cash six months from now instead of one month from now.
So, there are different levers you can pull to protect yourself. But I think oftentimes people are looking at it way too macro. Like it's not U.S. real estate. Prior to 2008, bubbles were regional. What happened in San Francisco was not the same thing that happened in Munster, Indiana. Right. They were very, very different buyer pools, seller pools.
Jaren: It's so funny that you're referencing local places. No one else who is listening to this knows Munster, Indiana. They are going to look it up after and be like, “Oh man, should I buy rental properties here in Michigan City, Indiana?”
Ajay: What is it? East Chicago?
Jaren: East Chicago.
Ajay: These are a bunch of Northwest Indiana towns for everybody that doesn't know the geography around. And you shouldn't. They're random, but actually, I have a rental in Valparaiso, Indiana.
Jaren: That's a great rental market.
Ajay: Yeah. So, thinking about the different levers you can pull down the line to keep yourself insulated from risk, thinking through who's your buyer on this land product type and who are the other buyers and sellers and what's the timeline for this stuff of selling and assessing demand on some fundamental level.
And I'm not super analytical necessarily in how I'm assessing demand, but even the tactics that we've talked about on different REtipster videos and podcasts before just looking at recent sales versus stuff that's on the market, that kind of a thing. You can assess some form of demand by calling local agents to figure out what the market is doing right now. You can often find people with buyers lists or they'll tell you, “Oh my gosh, 20 acres in this area, that fly off the shelf at this price.”
So, there are ways you can get information before purchasing, before marketing even as you're doing research. A lot of the changes I've been making and that doesn't even talk about a whole conversation about the actual marketing channels that I'm using. So, sorry, that was probably a 10-minute event there.
Jaren: The whole time you were saying that I was like, “Seth, what were you doing at 24? What was I doing at 24 years old?” I need to get all of my life, man, make something of myself.
I think that's actually a good segue to one of the key things that I wanted to pull out of this conversation is like, how did you do that? Let's kind of do a deep dive into how. If you could dissect what you've done in the last two years, and you could distill it down into some principles, what would they be? What was the thing that was most challenging? What was the thing that was most helpful?
Ajay: That's a really good question. What I really would want to boil it down to is information. And I think that's a very broad thing to say, so I'll elaborate. Whenever anyone needs to make a decision, you don't need time, you need information. And once you have enough information, and there's a whole discussion we could have about what is defined as enough. But once you have enough information and you're informed, you can go make a decision.
And so, for me, I recognized I have the same 24 hours in a day as Jaren Barnes, as Seth Williams, as Dwayne “The Rock” Johnson. And so how do I, as a young person… Listen, I recognize because I'm 24, there is so much life I have not experienced, so many market cycles that I haven't seen, that I want to learn from those that have and figure out what information they can distill and pass on into my brain so that I can make informed decisions on how to run my business going forward. Because I don't know it all.
And I think that's my biggest strength is that I want to believe that I have the humility and that I'm humble enough to know that I do not know at all. So, I have aggressively sought out other investors in the market. I would say I am in several masterminds more than I want to admit with high-quality investors.
Seth: That'll get you a lot of information.
Ajay: So fast. And again, it's funny too, because there's a level of experience, I do think you need to have to make some decisions. You guys have had Travis King on the podcast before I coached with him. He's one of my coaches. And it's funny looking back on some of the lessons we've had where he'll tell me something and I'm like, “Oh, that doesn't really make sense.” And then three months later I'll be like, ‘Hey, I did what you said and it worked.” And so, there's a level of experience you need to have to have conviction on a decision sometimes too.
But for me, I would say the way I've been able to achieve this so quickly would be leveraging other people's experiences to get information as quickly as possible. So, I was actually counting in my life, not even just across land, I have five different forms of either coaching or accountability in my life. And these are all paid forms of accountability.
Just to count them off for fun. I have a personal trainer for health and fitness. We meet at least twice a week to do weight training. I do not like lifting weights. I don't like thinking about lifting weights and I would much rather somebody lead me through it. So, I knew if I paid for it, I'd show up.
I have a life coach, a great guy out of Bulgaria. His name is Stan. We've been working together for six or seven months now and it's been really good. We talk about mindset. He's been really good for mindset. Getting rid of head trash, telling myself I'm not enough. I can't tell you how many times before I've met with an investor, been on a call, gone to some kind of a conference where I'm like, “Stan, I don't know if I'm worthy to be at this.”
Impostor syndrome is so real. Even after you have the experience, even after you can tell yourself I'm a six-figure investor for over two years now, I do deserve to be in this room for whatever reason you don't believe it. But life coaching has been so healthy for me.
As we talk about mindset, I have an accountability coach specifically for focusing on weekly high-leverage tasks. So, every week we assess, “Hey, what are three things I need to get done that will be the biggest push that moves the needle the most? And make sure I identify those and write out the subtasks and what those tasks look like when they're completed.
And then aside from those other forms of coaching, I have two land-specific coaches. I work with both Clint Turner and Travis King. And I can't even describe how helpful they've been in not even getting my mindset right, but talking about marketing, connecting me with other people, talking about certain sets of approaches, and then being able to be in their networks. So, there is just so much information out there and being able to find somebody who's an expert who's credible that you can trust so that you're able to have enough information to move forward and make an informed decision has been probably the biggest thing in my journey.
Jaren: I have a couple of questions. My first question is, I'm just curious, would you be comfortable sharing a ballpark figure of how much you're spending on coaching and accountability right now on an ongoing basis? And then what you've spent on coaching and education in land in general?
Ajay: I would say coaching specifically, we talk about all five forms of accountability I have. And I think I'm spending somewhere between, gosh, when I say this out loud, it sounds crazy. Somewhere between $3,500 to $4,000 a month. So, that is I'm realizing a full-time salary potentially, but I can't describe how much my ROI is from that.
You talk about little tips. I'll give an example, actually, with regard to my coaching with Travis King. We were talking and I had mentioned to him that I was interested in doing some cold calling. And he pointed me to a resource that he was aware of, somebody he trusted, which is huge. We talk about, there's all these resources, there's all this stuff on the internet. But trust is something that's really, really hard to verify until you've actually had the experience, which is why the power of referral is so strong as you talk about business holistically.
And so, Travis King is somebody I respect, somebody I trust. He gives me a referral? This is somebody I've worked with, who has delivered. Okay, that signals to me I can go give this guy X amount of dollars and he will deliver. And so, I remember after this conversation, the service we used was Lead Mining Pros. They're great at doing a job-type cold-calling campaign. So, I don't use them for ongoing stuff necessarily. I actually work with a different vendor that I don't necessarily want to talk about yet because I don't know that I would recommend them. It's not been long-lived enough.
You can send out, say like 2,000 dials. 2,000 cold calls. And I'm not joking. This is going to make everybody want to do cold calling now. We can talk about that as a separate discussion.
Jaren: Yeah. Be careful.
Ajay: Yeah. I think the third lead that I got was a woman who wanted to sell two properties in a nice market in Florida, some good infill lots. And she said she wanted $20,000 a pop for them. I ended up disposing of those lots I assigned them. One of them for $37,500 and one of them for $32,000. So, what does that come out to? What's 17.5 plus 12? Anybody who's good at math? 29.5.
But that was a marketing channel I wouldn't have used. A lead I wouldn't have gotten. And in that one instance, I got a deal where I made $29,500. That's more than I spend on coaching with Travis alone for an entire year. That doesn't even include how you quantify the success you're going to have five years from now because of that instance, not even thinking about the reinvestment I can do in the business thanks to that capital. Not even including the understanding of working with that marketing channel.
I learned so much about cold calling by doing that job and I was able to take the jump. How do you quantify the confidence to go forth and actually take action on something? Sure, in that one instance, I got more than my ROI and that's just one thing that I've done with the coach. And so, I can't recommend working with experts and coaches enough.
Jaren: I have a couple follow-up questions on this because this is very interesting. Because what you just said is very dangerous. If we were to just end the conversation right here and we were just, “Hey, go spend money on education. See you guys later. That's the key to success guys.” That could be very damaging to a lot of people. So, let's clarify this a little bit.
One of the things that I have said even offline multiple times with you around is one of the things that I'm highly impressed by is that you have this innate ability to identify not only just randomly pick a good land course, but the best land course or the best few takes on land. The fact that Callen is on your radar, Travis, me, Seth, Clint, all these people you gravitated towards, in my opinion, are some of the best in the land space in terms of quality of education. How did you do that? How did you know to pick the right moves?
Because it goes back to the 80/20 versus 10X Rule conversations that we had. It's not just applied paying for a course and then taking action on what that course says. It's getting the quality course, getting the right course, the right lever and pulling that 80/20 lever right there so that you can get the exponential return.
So, how did you do that? And then I have another question afterward.
Ajay: Okay. That's a good question. I think what I would start by saying is thinking through the results of whoever you're thinking about doing education with. Has this person been where I want to go? Assessing, if my goal is to run a seven-figure business, I should probably do coaching with somebody that's running a seven-figure business. And recognizing, okay, I have heard through the podcasts. I think Jesse Quang has a whole title on one of his that “This is a seven-figure investor, Travis King.” I'm like, okay, I should learn from him because he knows how to do this.
I think that'd be the first thing is recognizing have they achieved what I'm seeking to achieve? And then number two would be kind of an integrity thing as you have an intro call with whoever that is. Figure out who that person is, identify them and then go get to know them a little bit.
More often than not, I feel like everybody's got some form of an intro “Book 15 minutes on call with me.” And so, get 15 minutes with that person and assess what their motives are. Try to peel back the curtain. And it's like, “Why does this person want to do this”? Some people are truly fulfilled by helping people get to the next level. I'm sure you guys know this. How many people reach out to you and they're like, “What do I do? How do I do this?” How rewarding is it when somebody actually takes action based on what you're trying to distill to them. Here's the playbook, if you do this and do it consistently for X amount of time, you will read their award. How fulfilling is it when that actually pays through?
What I would say is the second thing is finding a mentor or even just somebody that likes to share information genuinely. I love knowing that other people are achieving success from this. If you can find that person who, one, has been where you want to be, and two, genuinely enjoys from a character perspective, seeing other people succeed, if you can pair those together in a way that's mutually beneficial to the both of you, you're off to the races.
Jaren: My third question, and that's very insightful, but one of the things that I have personally struggled with when it comes to subscribing to different education outlets and different industries and topics and so on, everybody has a different approach. And sometimes you have conflicting information. If you get a vegan and you get a pro carnivore diet person in the same room, it's really interesting because they get very similar results and you're scratching your head. They're saying completely opposite things, but yet they're both getting results somehow.
I'm just curious how you navigated that because it seems like I'm really impressed that you've subscribed to education and then took action on them. Because you've taken action on different camps that have totally different approaches to things. Like Travis has I think actually he came up with the concept of a range letter, I think. And I've never done a range letter in my life.
Seth: You mean a range offer?
Jaren: Yeah. A range offer. Sorry. So, how do you go into a framework without any preconceived notions and then extract what's the most valuable for you and your unique situation and then forget the rest? Because that's taking the best from here and then applying it and creating your own framework is also hard for me to do because I feel like “Who am I to trust my own bias when I haven't gotten the success that other people have?” So maybe once I've gotten success, then I can justify it.
But in the beginning, if I'm going to be learning from somebody or taking a course, I need to go in humble, go in with no preconceived notions and just say, “Okay, I'm going to do exactly what this person says.” But then what happens when you have two coaches telling you to do different things on the same issue? How do you reconcile all that?
Seth: Does that happen a lot where you get people telling you conflicting things? I mean, I'm sure it does, but I know just looking at the land courses, for example. 80% of what everybody says is the same thing. There are definitely differences, but for the most part we're kind of on the same page, it's just a matter of the richness of information.
Jaren: I think 80% for sure. But for example, I exclusively sell through agents. There are entire frameworks that don't even consider agents. On the flip side of that, there are people who intentionally go in with the goal of assigning and double closing. So, they intentionally figure out how to get deals at 25 cents on the dollar and sell it 50 cents to the dollar to another investor.
And so, there are all these different approaches to market research. I use growth metrics. Other people use totally different things. Some people just go after tourism and national parks and that kind of thing. So, maybe I am attached to details too much. Maybe this is just a Jaren Barnes issue, but in case it's helpful for anyone else out there, I was just curious, what do you do when you have Travis says to do X, Y, Z in this situation, Clint says do A, B, C in this situation? I don't know what to do.
Ajay: The first thing I'll say is I haven't had a specific instance where I'm getting two camps telling me completely opposite things. I haven't had two coaches say “Don't do that.” What I will say is when I am learning new material, I often think about what the process is and why people are teaching me what they're teaching me.
For example, some of the camps that teach not to invest with a realtor, why are they doing that? I think number one, you think about some of the camps that buy the really cheap desert squares for $1,000, sell them for $10,000, whatever.
The reason they're doing that is because one, a lot of realtors don't want to sell that stuff. Number two, your margins would suck sometimes if you're selling with the realtor at that price point. And number three, they just enjoy the simplicity of the process of self-closing at that price point. It just makes a lot more sense at that price point. That's number one.
Number two, we talk about the camps that do kind of like the assignments “go find another investor.” Well, the reason for that is it's really hard to list without there being some gray areas here with broker lists and some platforms like that. And some realtors and brokers are okay listing without actual title to the property but I would say a majority aren't and it's a whole conversation to describe and find the right person. And you could probably spend an entire day trying to find the right realtor in one market and come up with nothing if you don't own the property.
When I think about the inputs, I want to drive into my business and how I want my process to look, that's typically how I make my decisions. It’s “Okay, well, this camp is teaching you to just do all neutral letters for example, or all blind offers.” Well, why do they do that? Let's think about that. Well, all neutral letters would mean maybe you have a higher response rate and that higher response rate could turn into opportunities that you wouldn't have seen otherwise. Maybe if you do all blind offers, it's because you can do it more at scale and people who want 60, 70, 80 cents on the dollar won't even call you, which is better for you if you don't have the time or the team or the bandwidth or the processes in place to sift through all the responses you would've gotten, had it been some kind of a neutral messaging.
And so, when I'm looking at making a decision based on information presented in front of me, I try to look at the holistic process to think about what is this going to look like and how do I want it to look? How do I want to build my systems? How do I want to build my teams? And I think this is a good segue actually into that I list almost all of my properties with realtors. The reasoning for that, it's funny actually, I was having a conversation with Jaren a few weeks ago. And a lot of my investing is in Florida and he was telling me a lot of our strategies aren't that different. You invest in Florida, I invest in Florida. You use realtors, I use realtors. And I said to him, I said, “Jaren, that's not a coincidence. I learned everything I know through REtipster. When I heard you doing stuff, I was like, “Oh, I'm going to go do that.” So, it's not a coincidence in the slightest.
I've yet to find out of an instance where we're actually competing with each other for a deal. Florida's a really, really big market. And I think both of us do a little bit of stuff in some other states too.
Jaren: Yeah, I'm doing a lot of stuff in other states right now.
Ajay: Yeah. Yeah. So that's great. Regardless, I think the point being, I like using realtors for a couple different reasons. Number one, earlier, we talked about information. If you can get this information as fast as possible from somebody who's a local expert, you're going to stage yourself so many headaches down the line.
For example, I have markets where it's like, “Oh, well, yeah, this is the same zip code. But if you're north of the river, that's $6,000 an acre. And if you're south of the river, that's $3,000 an acre.” How would you know that? How would you know that if you have three comps north of the river and one south? You would just average them out potentially. And so, there are some pieces of information that you just cannot get without a local expert. I'm not saying it's a limitation necessarily, but I'm talking about the best possible case scenario for your exit strategy on a property.
Number one is information. Number two is the management of the disposition element of your business. If anybody here has done any work with Clint Turner or Learn Land and that community, he'll frequently talk about how there are four pillars in land business. He breaks it down as acquisitions is a pillar, your data, your marketing, you're getting deals. You have your operations getting stuff done. You have your financing, whether you're using financing companies, funding, assigning, whatever. And then you have your dispositions, actually selling your properties.
I outsource my entire disposition side to agents for 6% to 10% off the top line of these properties. When you think about it, through that lens, the amount of headaches, the amount of responses I don't have to receive. And given for a long time, I have had no team until recently. I just got my first VA. I even had the bandwidth to even think through all the potential calls that would come in from interested parties for these lots.
Maybe I'm losing out on money, but in my mind, I am repurposing that time into building a better business. And so, I love using agents exclusively because I outsource my disposition side and I'm getting that information. Again, you want to make sure you're talking to the right person. I think Seth talked about this. It might have been in your last most recent episode that got posted. Again, today we're recording. I don't know what's going to get posted between now and then. But with Doug Smith, you talked about how you used to just call any old agent.
I unfortunately also had to learn you cannot call any old agent when it comes to land. That comes with mistakes, and you don't learn what you quite thought was important. So, you want agents that Jaren’s got resources, REtipster got resources on how to find a land-specialized agent. Other people talk about how to find land-specialized agents. But make sure it is somebody that understands land, has worked in land, sells land actively, has active listings. You want sold listings more than you want actives. If you're thinking about it, I want a realtor that's sold properties versus them to just have the ability to list them. But I love working with realtors and outsourcing my disposition side in that sense. Sorry, I went on a side tangent. I know the original question was conflicting viewpoints through camps.
Seth: No, you totally nailed them, man. I actually thought that was a better answer than I would've even given. The way you said that kind of helped me understand, people have reasons for what they do. They're not just wrong, which I think that's sometimes how I don’t know if you want to call them influencers or coaches or whatever. Not always, but sometimes they position it like that almost to be intentionally combative to drive the point home. And Grant Cardone is huge on this kind of thing. But to your point, it doesn't have to be this hostile thing. We all have our reasons and it works for different reasons. I just understand what's going on in the background. That's really smart.
Ajay: If I could add to that, even thinking through these educators, a lot of them actually don't want investors to be thinking for themselves in the early stages and I'll elaborate. Because if you think for yourself, and this is going to be kind of weird here, but if you think for yourself trying to get your first deal, you are going to have, not all the time, but more often than not, a lot of analysis paralysis. People don't know what decisions to make and it's just going to stop them from making them.
I think a lot of these education camps do a good job of being like, “Here are the steps, go do the steps, get your first deal.” Because they know that's how that works. Maybe it's not the most optimal way, but it'll get you to your first deal. And once you get that experience, I talked about earlier, how there's an element of conviction and understanding you get once you have that experience under your belt, then go make the decisions on how you want to grow and scale and be like, I didn't like that piece of the process. Okay, go change it. But you're not going to go change your process before no process exists. You can't change your process that doesn't exist. And so, I don't think the education camps are wrong. I don't think anyone's teaching is incorrect. I mean, maybe some people, I don't know them all.
Jaren: Yeah, I'm not going to name names, but unfortunately, I have coaching students that come my direction from going into other camps and getting taught really bad information.
Ajay: That's too bad.
Jaren: It's really unfortunate. But it definitely exists out there. There's a short list of really solid people that do it right in the education space for land. But again, that was your superpower. You knew how to identify those somehow. Guys, the takeaway of this is yes, go pay for education. That seems to be the biggest leverage point, but don't just go pay anybody. Really know to pick the right people who are going to really be the ROI on your investment in education.
Ajay: Even to add to that, if you could have anybody that if you're thinking about doing coaching with somebody, ask for a client, if you can talk to a client of theirs. “Hey, what was your experience? Did you get success?” I think that's a really easy way to vet through somebody probably. And if they say no, probably a red flag. If somebody's like, “No, no, no, you can't talk to any of my clients.”
Seth: I mostly would agree with you, Ajay. The issue I've seen with that though is that everybody has testimonials. Everybody has these canned things that even if they're not a great educator, when you've churned through thousands of people, eventually somebody's going to stick up for you. It doesn't necessarily mean that they are the best or anything, but in terms of how a person would know that, I don't know. I guess what you're saying, that's probably what I would do too, but it's one of those things. It's just not a black-and-white thing.
Jaren: I would figure out a Facebook group or something of the educator. And then I would go and reach out directly to the students. Not have the referrals come from the coach.
Seth: Yeah. That's a good point.
Jaren: Hey you guys, I wanted to circle back before we jump off the call today, and circle back to what you were talking about Ajay related to the shifting trends in the economy and the market and all that. And really just hone in on what you see working today and what the current climate is today. You said that you noticed you had to do more direct mail, for example, recently.
How much more mail are you seeing? What's your typical direct mail-to-deal ratio? Let's just dive into all that.
Ajay: Yeah. Mail-to-deal ratio will depend on the type of mail you're sending, what markets you're hitting, and what price points you're hitting the map. I'm going to start there.
Jaren: You mean there is no one-size-fits-all?
Ajay: Yeah. No guys, you just send out 150 yellow letters and you're going to make $9,000. If you take nothing from this today, send out some tax delinquent postcards, you'll make money. This is a joke. This is a joke for everybody. It’s not financial advice.
I'm probably sending out between 8,000 and 10,000 mailers a month right now. Some months a little bit more. I would say in 2022, probably a few months a little bit less.
Jaren: Across how many states?
Ajay: Mostly one. I've almost done entirely Florida. I probably haven't sent more than 5,000 mailers total in other states this year. Again, Florida's a huge market. You could hit it. I've hit some markets twice even this year, just because I've been farming deals out of markets that I'm learning and stuff. But yeah, I'm sitting out between 8,000 and 10,000 mailers. And I would say that probably returns, again, depending on your price points, depending on your mail. I've switched things up a couple times throughout the year, but somewhere between two and five deals. Again, just depending.
Direct mail still works. Anybody that tells you it doesn't is maybe not sending out enough, maybe not following up. There's a whole element of follow-up sequence that I don't think is talked about enough in the land community. In terms of I have leads that it took me six months of follow-up before I finally closed. I had people that went into comas and came back that I am buying land off of.
I'm not saying that happens all the time but what I am saying is do not mark a lead until somebody has told you to go pound sand, until somebody has straight up said, “No, they're not interested, stop calling. I don't want to sell my land to you.” But if somebody has said yes, and you have not gotten back on the phone with them to make an offer, they are not to be marked as lost. You should follow up with them until the day you die. Maybe not.
But my point being follow-up sequences are so important. Continue that. I haven't figured out the perfect timeline or what communication channel is the best versus emails, text calls, voicemails, whatever. But I will say that my business has grown exponentially since I started following up with people more regularly.
Seth: Well, what is your follow-up sequence? Is this start with mail and then a number of other things after that? Is it more mail or texting or something else? Walk us through that.
Ajay: Yeah, it's very seldomly more mail. I'd say a majority of it is calls. I will call and leave a voicemail probably every three days or so. If it's a mobile number, again, I'll have my VA send out a text through OpenPhone to just follow up. Again, you're trying to trigger a response essentially. If somebody doesn't want to sell me, just tell me that. That's fine. I don't mind. But at some point, you are interested in selling your land to me and I want to make sure I can get you an offer if that's the case. And we've either prepared an offer or have additional questions regardless.
But if I've learned anything over time, you have to meet people where they are. If I only do follow up at 9:00 AM, 10:00 AM, I am not going to catch all the people that are at work at that time and can't answer their phone. And then after a long day of work, maybe they don't want to have a conversation about this. So, I'll do follow-up sometimes on a Saturday, you catch people in a great mood and maybe try not to catch them in between stuff. Again, play the times, figure it out, be conscious of the time zones you're calling and texting and whatever.
Seth, I would say my follow-up sequence is not as methodical as I would like it to be. I really just generally follow up with people every two, three days. A lot of it is calls. I have definitely gotten some voicemail inboxes where their inboxes end up full because of our follow-up sequences, but they end up calling back.
Seth: Yeah. On that thing, are you talking about ringless voicemail drops, or are you literally on the phone leaving an individualized message for them?
Ajay: I am on the phone leaving an individualized voice message. These are myself or my VA, one or the other.
Seth: This is a fairly time-consuming thing, right? If you're calling hundreds of people and leaving voice calls for them.
Ajay: Yes. Which is again, why I will say, or my VA, because she has freed up so much of my time on the acquisition side. Her job is basically initial due diligence, first touchpoint with sellers and follow-up sequence. So, if I myself have been following up with somebody two, three times, and then it gets to a point where I can't catch them, I then tag her in Pebble and say, “Hey, this is yours now. Let me know if you catch something.” And she continues to call them and she'll leave notes every week or so. I have her send me end of day kind of notes of just everything she's done that day.
But it will suck a lot of your time if you were doing follow-ups every single day. I mean, you could spend two to three hours on that alone, which you could argue is a revenue generating activity, but you could also argue there are better revenue-generating activities.
We talk about 80/20. And I want to focus my time on what's more effective.
I think the other thing I'll say too is my VA's job is essentially to disqualify a seller as fast as possible. When you think about guarding your own time, now given if it's an opportunity, I want to be able to jump at it. So, we have processes in place that, “Hey, if this seems like an opportunity, or this is something you're not familiar with, let me know and I'll jump in.” We market to an area in Mass and we know everything here sells for $25,000 and this guy says they want $30,000. Okay. I take a look at the note and I hit lost in Pebble. This is not worth my time. Very seldomly, are they going to accept an offer for $12,000? If I want to offer 50 cents off the dollar, if they're asking for $30,000 that day. And maybe I'm wrong and maybe they'll call back and maybe I'm losing out on leads. But I would say in Mass, in my experience, that is not a lead I need to be following up with.
Seth: Yeah. I guess with all this cold calling or texting, or whatever's involved there, is any of this automated at all? How do you even keep track of, “Okay, these people didn't respond on the mail, put them on the list for cold calling and I'll just spend a couple of hours on Saturday doing that.” Is there any kind of software you're using to do that? It just seems like a ton of stuff to keep organized. How many times have I contacted them and this kind of stuff?
Ajay: Yep. I think the first thing I'll say is I do cold calling, I do cold texting and we do direct mail. Those are my three marketing channels, any lead that comes in through direct mail, if it's not going directly to my VA goes through PATLive. And PATLive has a form that they enter in my website that feeds right into Pebble. So, I see it. I get a notification. I know it's in our pipe.
With regards to the cold calling and the texting. I myself am not doing the dials and I myself am not sending out the text messages. My VA sends out the texts. I have a third-party company that does the cold calling. The third-party company that does the cold calling sends leads into the project management software Asana. If anyone's not familiar with it, it's a nice project management tool.
It keeps track of stuff. There's a free version that basically is a Kanban board, really nice, easy way to keep track of stuff. My VA has access to this board.
And so, I'll spend maybe some time during that day, depending on what new leads came in through cold calling campaigns, vetting “here's what we can offer on this property.” If it seems like an opportunity, we move it into Pebble. If it doesn't, again, sometimes there are notes from the cold caller, they want $50,000. I look at it, it's worth $40,000. Okay. Not worth our time. Or more often than not, I will still have my VA actually reach out to the seller and still make an offer. Because you just never know. And marginally, in my mind, if we just get one deal that we wouldn't have otherwise throughout the course of the year making offers on that, we get an ROI pretty easily.
Anyways, Asana kind of acts as a screening board. I don't want leads into Pebble if they're not qualified leads in some sense. And if they come in through direct mail, we've got columns that are lead in and due diligence and we try to disqualify them as fast as possible before it becomes qualified. And then we have a follow-up sequence and then there are all these other columns I could talk about that I have in Pebble.
But I would say there's kind of a screening process in between Asana that goes to Pebble. And Pebble is like our source of truth. And then again, we use OpenPhone. So we're able to see our history of any seller, like, okay, we've got 16 outbound calls on this seller. And maybe after a certain point, I will send out another piece of mail to follow up and just see again, if it invokes a response or whatever. But I will very transparently tell you I do not have the perfect follow-up sequence here. There are other investors that definitely have more dialed-in strategies than I do.
Ajay: Callan is phenomenal. She is brilliant. Listen to her about follow-up sequences. But yeah, it's definitely a work in progress, but I use both, Launch Control, which is what we use for texting and Asana project management board with leads that come in from cold calling. It's a kind of screening so that it doesn't go into Pebble right away. But as soon as we have any indication that they're either looking for an offer or it might be a deal, it goes right into Pebble.
Seth: Of all those different mediums, we got cold calling, direct mail, texting. I don't know if you do email or ringless voicemail or any of that stuff, but what is most effective do you think? Is mail the default that you start with or do you start with something else? I don’t know, just in terms of time and money for value, what do you get the best response from?
Ajay: Yeah. I'm going to set a couple of expectations here. Number one, all three work. Direct mail works, cold calling works, text messaging works. Talk to anyone that's been doing it consistently for six to 12 months and they'll tell you that.
The second thing I'll say is I have been doing direct mail the longest and it is the process that I understand the best. I would never recommend any investor stop a process that's working. That is the fastest way to stop getting leads into your pipeline because you start marketing through these other methods.
You might not realize it, but maybe you don't have the team in place to handle that volume of leads. Maybe you can't do due diligence in these new markets as fast as you thought you could because you either haven't found the agent, don't know the county sites, don't even know what due diligence pitfalls to look out for. I'm not looking at slopes that often in Florida and I'm not looking at wetlands that often in Arizona. I still check for those things because actually in Arizona there are some floodplains and wetlands every now and then, but that's a different conversation.
My point being there are different due diligence pitfalls in different markets. The second thing I'll say is I've only been doing cold calling since April and as we're recording this today, we're halfway through July. So, I'm very hesitant to share mass results in over a three-month period because it's not long enough for me to have conclusive evidence in my opinion. I will say I've gotten deals from cold calling campaigns. Again, I'll emphasize that it works, but you have to sit through more information. So, make sure you have the bandwidth to do that.
It's the same thing for text messages. You were doing cold marketing, which invokes a higher response rate, which means you are going to need more time to sift through those leads as they come in. And if you either don't have the team or it's not a market that you know well enough, it’s going to suck your time fast. I could tell you I've spent hours finding realtors and areas that have busted and you just wasted three hours of your day. Versus if I'm in a market I know, I get a lead and I spend three minutes comping and I know exactly how to do my due diligence. So maybe I'll spend an accumulative 15 minutes because I know my exact processes there. Unless I got to get some kind of a surveyor out there, which is a different conversation. If you know your market's really, really well, it's probably easy to explore these different methods of communication.
But again, it depends, which is kind of a cop-out answer here. But I can't tell you with conviction which one is the best necessarily. What I can tell you is I personally have the most experience in direct mail. Direct mail does bring me deals. Cold calling does bring me deals. Text messaging is just beginning to get me deals. And if you do it consistently over enough time, you will get deals.
Seth: Maybe a better way to ask the question is, which one do you like the best when you just think about what you feel when you think of one of those? Which do you like the best and why? Is it because it brings the most, those deals, or just because it's easier?
Jaren: That’s a good question.
Ajay: That is a good question. I don't know if I've put a lot of thought into which is my favorite. I feel like it's like picking a favorite kid, Seth. Who's your favorite kid? I'm just kidding.
Seth: That’s a pretty good analogy. But I'll just say the worst is direct mail and I'll look at your face. Are you smiling?
Ajay: No, I'm just kidding. Yeah. I'm sorry. Again, I would say take time to learn what the process is going to look like with all of these. I'm enjoying, I guess, cold calling from the sense that it is the easiest to outsource that process. There are all kinds of cold-calling agencies out there. And so, having it pretty turnkey in the sense that I send them a list and then leads get uploaded into Asana. They've recorded the calls. So, I can listen to the calls if I want to, or my VA can listen to the calls and they've got notes in there. It's probably easiest in the sense of resources. If you think through resource capacity, if we're doing texting, we ourselves are doing the texting and converting those into conversations. If we're doing direct mail, it's the same thing.
I will say though, I feel like the most qualified leads come from direct mail, is maybe my caveat. You call somebody, “Hey, you want to sell your land?” “Sure. Give me an offer.” You get that all the time. And so, I would say the most qualified leads will typically come from direct mail.
Jaren: But that's the variable too, because the list of numbers you can try and get a better qualifier of some sort, some data set that would increase the motivation of the sellers. It's really hard to answer this question, but keep going. It's fun to watch your answer because I've struggled many times to answer that question.
Seth: You mentioned something about cold calling agencies. So, tell me about that. Have you hired an agency or you just know of it? How does that work?
Ajay: I hired one. They basically do. I think it's 20 or 25 hours a week of cold calling. I just send them a list. And that's the one that they'll end up uploading this into Asana. Basically, you send them a list and they've got dialers. So, they manage the dialers. It's something you don't think about if you're not doing cold calling, but you need several phone numbers. After a certain set of days, you start getting marked as spam. Actually, if anybody's ever gotten a phone call and it says spam risk. You don't want that. So, these cold calling agencies not only manage the dialers, meaning like the mojo dialer, not like the people dialing the phones, but the actual technological dialers. They'll manage the phone numbers. So, the agency I'm using right now burns the numbers every 10 days and then gives you a different number so that you're not marked as spam.
And then there's actually management of your caller so that I'm not managing another resource. It was the fastest way for me to get into this marketing channel without having to spend a bunch of time learning all this stuff, make sure I'm compliant, all that jazz. And then second actually managing a resource because I don't really want to coach up a cold caller, especially considering I myself haven't done cold calls. So, I don't know how valuable I'd be when it comes to training that. How do you train on a process that you yourself have not done effectively in my mind?
And so, for me it was the most turnkey solution. Full transparency, I think right now I'm paying about $1,100 a month to have that 25 hours a week. And it's probably bringing in anywhere between one and five leads every single day. So, it's a good lead source. Of those, again, I've only been doing this for three months, so I can't tell you conclusive evidence of those leads converted to deals again, because that follow-up sometimes takes a long time.
I have leads in my pipeline that were from cold calling sequences that I'm still following up with that I've sent contracts to that said they're interested in selling and we're just waiting to close this up. And some of this stuff just takes time. It's not today or tomorrow kind of a thing. And so, bring me back in six months and maybe I'll have a different tune.
Seth: Is it REI Call Center? Is that what it is?
Ajay: Yeah, that's it. Sorry. Yeah, I think so.
Seth: I just Googled them. Sorry for the question on this. I haven't talked to many people who have done this on land, but the idea is you give them the numbers, you give them some kind of script of what they have to ask. How deep do they go into this conversation? Say if it turns out to be a good lead, do they gather all the information and then give it to you? Or is it just like, “Hey, this guy's interested. Now you follow up Ajay.” How does that work?
Ajay: Yeah. There's definitely a script. I would say it mirrors a lot of what you'll find in the house wholesaling world. And that's another thing I would really recommend listeners to dive into is the house wholesaling world in the sense that these guys have been doing it a lot longer than the land industry in some sense. And they've got really mature processes for their marketing. Their acquisition side of the business is extremely similar to ours. It's very different on the disposition side is what I'll say. It's a different product. It's a different disposition.
But in terms of techniques, we can learn from acquisitions, I think there are a lot of good learning lessons from there. If I could recommend another podcast, if that's allowed, Steve Trang’s Real Estate Disruptors is phenomenal. They really just sit down and open up their playbook. And I have drawn all kinds of stuff about sales process learning.
That's another thing I want to briefly touch on is a lot of people don't realize that when they start in the land business. But if you're on the phone with the seller, you’re selling cash, you're selling money, you're selling convenience. You're in sales, whether you like it or not. And so, you really should try to learn sales as much as you can. I actually have it as a rock this quarter, rock being a terminology from the book Traction by Gina Wickman about a quarterly objective to master my sales process in my business. If you look behind me, this box right here is actually a pamphlet and a set of stuff from the 80s. Xerox, like a printer company, spent tens of millions of dollars pouring into their sales stuff. And I'm going to go through it sometime this quarter, learn everything I can from sales and try to include it into the business if I can.
I'm taking techniques from wholesalers all the time, trying to use neurolinguistics. I think you've had guests about that kind of stuff before. What can we do to just raise the bar and get as many leads to closings as possible, especially if you're willing to be creative. Because as a business owner, you're in the business of solving problems. And if somebody needs a property sold, just because you can't buy it at 50 cents on the dollar, you just had Jesse on here a few months ago, can you do an option contract? Can you assign it? Do you know somebody else that's in this market? Can you partner? There are other things you can do to de-risk yourself. But sorry, that's a side tangent, Seth. Let me answer your question now.
I will send them a script and the information they gather is pretty limited. We confirm name, we confirm the area or address. If the property's gotten address to make sure we've got the right person, right property on the phone. And then they're actually going to gather just motivation. “Why are you looking to sell?” They try to get a price point if they can. “You own it for a long time. What are you looking for?” And off the top of my head, that might be it. So, it's really just motivation. “Are you interested in selling? Why are you interested in selling? What would you sell for? And what's your timeline? We typically close within 30 days. Is that a timeline you can work with?” “No, actually my brother-in-law also has the property and he's…”
You want to get some of this stuff. Again, you're trying to disqualify as fast as you can. If somebody says they want a million dollars on a $200,000 property, you're probably not going to buy it. I might still make an offer with my VA. I might call them up and say, “Hey, we can give you $100,000,” and they're going to tell you to pound sand. And if they do, that's fine, but we made an offer. So, trying to collect that stuff and disqualify.
Seth: And you said this stuff is all recorded, right? So, you can go back and listen to whatever they said.
Seth: Do they only give you the recordings of the people who are, “Yes, this is a good lead” or do they just dump everything in your inbox and you got to sift through it?
Ajay: I think I have access to everything. Don't quote me on that. I can't say I've tried to listen to the bad calls because that sounds like a nightmare. I barely listen to all the good ones. There are much better forms of entertainment out there guys. Like REtipster is great. I'm going to set up a YouTube channel just for this.
Jaren: That actually would be a really good podcast or a YouTube channel.
Ajay: Yeah, no kidding.
Jaren: And you just had the real estate blooper calls and everybody sends their worst motivated seller calls of all time.
Ajay: Even voicemails of all the angry sellers. All right. We're getting too sidetracked here. What I will say though, is they attach the recording of the call to the file in Asana. So, there'll be a downloadable audio file in Asana that I can then download and listen to for all the successful calls. I think there's a dashboard I can log into to listen to all of them. If I wanted to spend four hours of my day listening. Maybe I'll listen to them at 2X speed or something to get through quicker. But to my knowledge, yes, but don't quote me on it.
Seth: Yeah. But I guess one of the main takeaways for the cold calling and this maybe applies to texting and other stuff too, but the main takeaway is these are people who for whatever reason were not responsive to direct mail. Maybe they threw their mail away. Maybe they just don't like how you come across direct mail. So, if you hadn't cold-called them, that never would've been materialized. Is that accurate or am I missing that?
Ajay: I think so. And I think there's something to recognize about a call to action. So, you think about direct mail and the onus is now on the seller. You have sent them this and they have to either call or submit it on the website or do whatever other option you have for a seller to reach out to you. The onus is on them.
But when you're already on the phone with them, you've opened that door. And that's kind of what you're trying to get to as a phone call. And don't get me wrong. There are sellers that don't like talking on the phone and just want to communicate over email. And that's awesome. If I don't have to talk to anyone and I can make money, let's do it all the time. If I could just email sellers that are motivated for a living, we would be having this podcast at my lake house in West Palm Bay or whatever in West Palm Beach.
But when you're able to get somebody on the phone, there's just an extra element of building rapport if you've had this conversation with a person. You have the ability to build trust. We talked about trust earlier. How do I know you're not a scammer? Well, you don't. So, let me get to know you, whatever. Can you use certain tactics to then build rapport?
But I think there's an element of just meeting this seller where they are. And even as you think it through, we're talking about marketing holistically. But I think again, instead of thinking of the macro, let's look through the lens of the micro for a second. Each one of these sellers is an individual and your 24-year-old seller that just inherited a property in rural Kansas is going to be a different demographic than your 86-year-old seller named Betty that bought it to go live with her husband who's passed away and she lives in Massachusetts. Those are two very different seller demographics. And honestly, getting on the website is very difficult for Betty potentially. I'm not going to generalize, but generally speaking, the older folks maybe have a little bit more trouble with the tech. Whereas if you're already on the phone with older folks, they actually love talking. And so, you may have a 25-minute conversation that only three of those get somewhere.
But I would say the focus is less on how effective the marketing is and more on whether can you touch more people this way for marginally less cost and less investment? And an investment not even just being dollars, but actually acquiring information as well. I'm really big on information here because if it's a market that you know very well and it's big enough that you can send out mail and do text and do calls and it takes you less time to do due diligence and you already have a realtor on the back end and it's a very easy system that you've got flowing, ideally, you're getting a lot more deals out of it. Again, maybe not quite the answer we were looking for, but it's about the angles in the process.
Seth: Yeah. On the cold calling thing, did you have to make up your own script and give it to them? Is it just a list of questions or you have to literally spell out word-for-word, say this to these people. Because I know it almost kind of sounds like PATLive, but instead of accepting calls, they're making the calls.
Ajay: They're outbound instead of inbound. Right.
Seth: Is it pretty much the same thing with that one difference?
Ajay: I would say, yeah. It's pretty similar. Sorry, I didn't mean to cut you off there, Seth, but yeah, very similar. Honestly, again, I'm not saying this is perfect, but I just tweaked the script that the households’ sellers were using. I made it more effective to land. Again, it is a rock of mind this quarter to work on sales process and so copywriting and working through the actual verbiage we're using in our cold calling in those conversations is something I'll be working on for the next two and a half months.
Hopefully, I have better information for you later, but I'm a really big progress-over-perfection person. And so, I'm like, “Well, this works, let's get it out the door and see what happens. And oh, look at that. It's bringing me deals. Let's make it better now.” If I can just keep progressing in the right direction, I know I'm doing the right thing or at least I think I am. So yeah, I don't have any magic copywriting for you. I just tweaked what the wholesalers were using.
Seth: Gotcha. Awesome, man. Well, I guess maybe we'll try to wrap this up. Ajay, you've been very generous with your time. I appreciate everything you've shared. I've learned a ton just from talking to you here. If people want to find out more about you or get a hold of you in some way, you don't have to offer this up, but if they wanted to find out who is Ajay, that kind of thing, beyond what this podcast is all about, how would they do that? Do you have a website or something?
Ajay: Yeah. I actually just started an Instagram page recently. There's not a ton of content on there yet, but I am really responsive on it. So, you're welcome to just DM me. It's investingwithajay and I'm going to begin posting content about real estate, land, business, mindset, entrepreneurship, all that fun stuff. So hopefully by the time this airs, there's more on there, but it's a great way to get a hold of me. You're welcome to DM me and I'm happy to hop on a quick call and talk through that. If there's anybody out there that's a land wholesaler, you're welcome to hit me up and see if we can potentially work together.
Jaren: I am that friend, me too. If you're a wholesaler out there, I will buy it 50 cents on the dollar all day long.
Ajay: Jaren and I will be partnering on some deals if there's anyone.
Jaren: We are actually selling a property that we're partnered on right now.
Seth: Isn't that like a huge deal?
Jaren: Yeah. It's a good deal. It's not as good as it could've been. I think if we would've waited out, it could've been better, but it was a good deal.
Seth: This is one of those conversations where I wish we could go a lot longer. I feel like we could very easily, but this has already been a pretty long one. So Ajay, thanks a lot. I really appreciate it. And maybe we can do part two at some point. It sounds like there's plenty we could talk about. But in the meantime, I appreciate you sharing as much as you did right here. I appreciate it.
Ajay: Yeah. Thanks guys.
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