Want to Do More With Less? Here’s how Calvin Brown Automated his Business and Built an Effective Team!

OWEN:       My guest today is Calvin M. Brown and he is the CEO of Investment Homes Direct. Calvin welcome to the show.CALVIN:     Hey Owen, how are you?

OWEN:       So let’s get started. The whole idea of this interview is to get guests on here who have been able to systematize their business so that it actually now runs, in your case, without your own involvement. And let’s talk about some mind-blowing results that you now experience as a result of going through the process of systematizing and automating your business.

CALVIN:     Right. Owen I’ll tell you, the most mind-blowing thing for us is our ability to do more with less. What used to take us 15, 16 employees and a lot of involvement to do now takes, through the process of automating and systemizing the business takes about half of that, and about half of that involvement. So for us the biggest thing we’ve experienced is just our ability to do a lot more with a lot less.

OWEN:       Wow, that’s awesome. How will you say your company has been transformed as a result of systematizing the business?

CALVIN:     Actually, the biggest thing that’s transformed for us, like I said, we’re able to do more with less which is resulted in our ability to can up, which sounds kind of counter intuitive to growth. But we’ve actually been able to consolidate, shrink in size, and maintain the level of revenue that we had when used to have a huge office and a ton of employees, and a lot of overhead. The biggest transformation for us is has just been our ability to consolidate into a smaller sized company with a reduced overhead but still maintain those levels of profitability and the levels of revenue.

OWEN:       That’s great. And so, how would you say your personal life has actually been transformed as a result of systematizing your business?

CALVIN:     The most obvious thing is that it obviously frees time for me to spend time with my family. I got married kind of right in the middle of our business kind of growing and taking shape and taking form. I spent a lot of time spending a lot of hours in showing up early and staying late. Now that things are kind of running a little bit more smoothly and kind of autopilot it frees up a lot of time for me to do things with my family and spend time with my wife. We’re actually expecting a baby here in the next couple of months.

OWEN:       Congratulations.

CALVIN:     Thank you, I appreciate it. I’m excited I’m not going to be the guy who’s missing my child’s adolescent years because I’m busy at the office until the wee hours of the night.

OWEN:       That’s great. Speaking about that, what will you say has been the longest time you’ve been away from the business now that you’ve actually systematized it? I’m just curious.

CALVIN:     Right. To fully understand the answer to that question you have to understand that I enjoy work. I don’t have many hobbies. This is [Unintelligible 00:03:11] so it stresses me out not to be at work but I would say the longest time I’ve gone without being here is probably 2 weeks. Every year my wife and I and her family do a bicycle trip over a 2-week period in the summer, where we usually ride about 400-500 miles through either… Last year we did Anacortes, Washington to Spokane. The year before that we did Maine, Vermont, and ended up in New York. So 2 weeks is about the longest I’ve spent away. And those 2 weeks was without a laptop, without consistent cell phone reception and Wi-Fi access. And the time of technology was probably more like several months for most people.

OWEN:       That’s awesome. And so, just so the listener can get some context as to what your business is about and what you guys do, what exactly does your company do and what big pain do you solve for your customers.

CALVIN:     Right. IHD is a real estate investment firm. We specialize in the sale and purchase of single-family residential investment properties. We offer our clients market access to an inventory of kind of off the shelf real estate investment opportunities. We work with a team that consists of both acquisitions associates, and sales associates. Think of acquisitions kind of like manufacturing, our AA’s are responsible for going out, identifying, analyzing, negotiating, packaging these potential investment opportunities. These deals are our products that our sales team goes out and markets, and subsequently sells.

OWEN:       Awesome. How many full-time employees you guys have?

CALVIN:     We currently have nine including myself.

OWEN:       Is the company profitable and what was last year’s revenue and do probably expect to generate this year, I’m just curious.

CALVIN:     Yeah, we’re profitable and we have been since our inception, which is pretty rare. Last year we did about 650,000 in gross revenue, and this year we’re projected to do about the same.

OWEN:       So now we’ve given the listeners some kind of insight as to where the business is and how it’s systematized now. But we want to take it back before we got to the point where the business was actually systematized. Take us back there. What was wrong at that point when you didn’t have systems in place? I’m curious. Let’s get some insight into that.

CALVIN:     Right. For us, our biggest challenge has always been retention. It’s been our ability to go out, and hire, train, and retain quality people. A big part of that was for a long time we weren’t able to provide a new employee with any sort of infrastructure or any sort of system that helped ensure and promote their success.

OWEN:       Wow. What would you say was one of the lowest point during that time and describe how bad it got?

CALVIN:     I would say probably the lowest point because we’ve been progressing ever since then, but it was our first attempt to hire folks. We were in business for about a year kind of bouncing deals off of each other. I had a couple of partners at the time. We spent about a year kind of “you do a deal, I’ll do a deal, and we’ll split the profit.” That was great for a little while, but ultimately we weren’t really generating any business revenue. So as an opportunity to kind of generate some actual business revenue we decided to go out and hire folks. It was in the middle of 2008, we were a fledgling company that was five guys sitting in a 1-room office. We didn’t have much to offer. But it was amazing that the level and quality of applications we’re getting from folks that had lost their job because of the economic crisis. So we were able to go out and advertise. And we were actually able to hire 4 or 5 people. I think the lowest point for us kind of came after we hired those people. And within a couple of months we kind of saw all of those people just kind of fizzle out. To me, the difference between a business and being just a sole proprietor is your ability to take what you know how to do and teach somebody else how to do it, and give them the tools and resources they need to be successful. At that point when we weren’t able to do that we were kind of starting to question, is this a viable business from the sense of is this something that we can grow and scale, or is this something that we’re going to be just doing on our own forever. To me that was the lowest point.

OWEN:       In that same line of the story, do you remember when was your breaking point? Do you remember the specific that happened that you were like, “I can’t take this anymore. This business has to be systematized. We go to change how this business is going right now.”

CALVIN:     Right. It was basically after that. We were in the middle of this down market. We weren’t doing a lot of business, we were basically scraping by. And the breaking point was if this is something that I’m just going to have to do on my own forever then that’s not really something I want to do. If this is something that I can turn into a business, and we made a conscious decision that this is something we wanted to turn into a business. If weren’t going to able to do that then we were basically going to pack up and go our separate ways. So really that was it. The lowest point was the breaking point for us. Our first experience with hiring people and realizing that we were not prepared to make those folks successful and retain them. And to us that was really what a business was.

OWEN:       Yeah. Now, we’ve described what was happening back then. What was the very first step you took to solve the problem you just mentioned during the lowest point of the business?

2; It’s essential to building any business to me, for the most part. But the first step we took was disassembling the task of our business. The process of our business was buying and selling real estate. And to really figure out the business behind that task, or the business behind the business required us to sit down and really disassemble it, and analyze the parts and start identifying points of automation. Build some sort of system or provide some sort of technology that would help make that piece easier and more efficient. You hear these stories about inventors and most of them got their start by disassembling computers because they want to know how things work. And that same kind of thing applies to business. You don’t really understand how things work until you’re willing to sit down and break them down. Take all the pieces, put them out on a table and analyze them individually, and go, “Okay, these are things that I can automate. These are things I can make more efficient. This is what goes into it.” It sounds intuitive but it’s really not. It was a struggle for us in beginning, but it was certainly imperative and essential to us growing our business into what it is today.

OWEN:       So basically you identified the individual task that were involved in your business so you could understand probably where to assign or delegate employees to. So that was the first thing you did. And also, during the pre-interview you mentioned how personality test when hiring people, and also they need to hire people where self status. Talk about that, I’m just curious.

CALVIN:     Like I said, a huge challenge for us has always been retention and hiring good quality people. We kind of tossed around ideas on how do we find a good employee. How do we find these people? Not only how do we find them but how do we retain them. So we threw around ideas of personality test, and we threw around ideas of hiring a professional. For a long time we actually just used the old mirror test, which is basically, if they’ve got a pulse and they can breathe hire them. If they succeed, great, if they don’t then “Oh, well.” It really wasn’t until we sat down and applied that same disassembly strategy that we used to kind of systemize the business side, or the process side. We applied that same strategy to our hiring process and really sat down and took an associate and disassemble them, not literally, but…

OWEN:       What makes the best one work…

CALVIN:     Right, and what are the traits in this person that makes them good at this. So what are the traits in this person. And we started to identify some core competencies and some traits that we felt really were kind of precursors for success. And those were things like being a self-starter, being organized, having a personal connection to the company and to the team. We took that and we built this perfect associate. We developed interview process and hiring process that was built around hiring that person.

OWEN:       When you say connection to the team, you mean actually getting referrals from people who are already in the team, right? That’s was you mean?

CALVIN:     Yeah, literally a personal connection. We’ve had a lot of luck with hiring people that know other people. We’re a lot like a sports team. We work well together, everybody’s success is based on everybody else’s effort. We find that the people we’ve had the most success with bringing in and retaining are the people that have a connection to somebody already in here. A lot of our training is kind of peer-to-peer. So if you come in and you’re an introvert, and you’re not willing to actively go out and kind of seek knowledge from other people in the office then you’re most likely not going to succeed here. We found that if we hire somebody’s friend, or ex-colleague or something like that, they have that immediate connection and it’s just easier for them to transist, and coming, and learn, and pick things up and stick with it.

OWEN:       That’s awesome. What was the second step you took to solve the problem? I think during the pre-interview you mentioned something about having a pen, and paper, and a calculator. Talk about how that plays a role.

CALVIN:     The second step from the point of taking everything apart and analyzing everything. We kind of started identifying those points of analysis and started putting pen to paper, and figuring out all of the pieces of that puzzle that we could build technology to make that part more efficient. An example that was when our guys went out and analyzed the potential real estate investment opportunity. We used to have a formula that we taught everybody. It was 80% of this divided by 2 and multiply it by 3. Magically you’ve got what you…

OWEN:       What the offer should be…

CALVIN:     What the offer should be, exactly. We literally went out and bought calculators for everybody and everybody hand typed it in. After a while we realized that somebody lost their calculator so they weren’t able to do those calculations, or they forgot the formula, or they weren’t good at math, or whatever. We realized that we could build a calculator that did that did for them where all they had to do was input the numbers and it output the amount that they should offer. And that was an example of something that we did.

OWEN:       A manual, yeah.

CALVIN:     It’s an example of a result of something that used to be a manual process that we figured out, and kind of an easy way to automate it.

OWEN:       That calculation tool to know what offer to offer. I think this is also in-line with digitizing and stuff, but you created a database. Can you remember what that was and how that played a role in basically entering the information so that they always saw it wherever they were?

CALVIN:     Right. Basically, when we started we developed all these… I guess I should go back to this. Our first wave of systems after analyzing all this stuff were mostly analog systems. They were Excel-based. We actually had like a binder that we used to kind of collaborate on deals where an individual associate would get up and write the property address and all the information. Another associate could literally walk over, pick up the binder, look through it and say, “Okay, associate Andrew is working on this deal.” So basically we took all those analog systems and we built a digital system, put them all in one place, made it accessible from anywhere, and we called it IHD tools. It’s comprehensive. It does everything from help our guys track workflow, to analyze deals, to write contracts, to create marketing packages. We actually created this little plug-in that automated our lead generation. It’s a pretty powerful tool for us.

OWEN:       It was all manually done before and then you now eventually digitize it. I’m curious. Were there any steps that come to mind that you guys took to solve the problems at that point?

CALVIN:     Steps in the sense of…

OWEN:       What else did you do to… Go ahead.

CALVIN:     I’m sorry. Steps in the sense of automating the process or steps that would apply to just the business in general.

OWEN:       Actually kind of automating and systematizing the business.

CALVIN:     Got you. Other things we did were really sitting down, and this sounds kind of intuitive to think that you could hire somebody and not provide them with direction. But providing someone with direction in the sense of not necessarily a procedural direction but more what is expected of them. So after we got everything digitized and we got everything put in one place, and we had all the tools and resources that the person needed to operate, we had to sit down and really think of what do we want these people to be doing every day. It was an easy thing for us because we came out of the gates making money, and significant money. We were generating revenues, $800,000 in our second year. It was like a whirlwind. And we never took the time to really sit down and go, okay. We know what’s going in task-wise into this, but what’s going in work-wise. What should be expected of somebody. What is this person’s job description, what is this person’s goal for the week or for the month? It wasn’t until we really started doing that, that things really started to kind of take off. After we’ve got everything digitized it was that that really took us to the next level.

OWEN:       You guys also developed your own custom software, right? That was part of the digitization of everything you were doing, right?

CALVIN:     Yeah.

OWEN:       Okay. I’m just making sure. Also, I’m just trying to understand. At that point where you’re making those decisions, how did you prioritize what steps to take? How did you decide what systems to create first and what was… You understand what I’m saying? That way the listener can understands the decision making factor that played a role into this.

CALVIN:     Right. I’ll approach it and answer the question in two pieces, and the first would be how did we develop the digital software. And that started with after we sat down and we took everything apart, and then we looked at it, the first thing we started with was the tedious stuff. The stuff that you need to do but you don’t want to do. It was often overlooked things like lead generation. It used to be where our guys would go into this online database and they would filter through and dig through all these listings and filter the ones out that kind of fit our criteria. And that was very tedious. The hardest thing for people to do every day was to come in and spend time just doing this tedious, menial task. We started with the tedious task and we developed this system called Spartan Leads that basically automated that process. It went in and pulled out properties that fit our criteria. It put them into a format that fit what our agents were used to seeing. And it put right in front of them every day. They could click one button and it took all the information. It automatically put it into our system. It helped a lot. We started with the tedious stuff. We’ve moved on to the organizational stuff. I’m kind of organized but I think I’m probably more organized than most people. A lot of people struggle with that. We focus on how to make people more organized because we knew that was important. So we developed things like our own database that would allow people to kind of track their workflow and see what properties they were working on. In real-time see how many offers they were making and how many clients they had, and how many deals they had in each stage of the process. Once we get done with the organizational stuff we moved on to the analytical stuff. And then we started developing calculators and other tools that allowed our guys to easily, and efficiently, and accurately analyze deals. That was a huge help too because not only did it create efficiency but it also helped us standardize that process. And like I said, acquisitions for us is like manufacturing. If you’re manufacturing cars you certainly don’t want to have every car that comes off the line be different based on which person put the hood on. It doesn’t make sense to do it that way. You want a standardized system so that when they product comes out of the other end it’s the same car every single time and it’s of the quality you need it to be, and it’s based on the same design and the same specifications. It’s the same. Providing those analytical tools really helped our guys not only accurately analyze things but it also provided some standardization. It was a huge help.

OWEN:       Awesome. At that time when you were actually putting this work to systematize and automate the business, I’m curious, what books or mentors actually had the most influence on you and why?

CALVIN:     Books and mentors. There’s one thing that I’ve struggled to find in my life and it’s a good mentor. But that’s not true. I have a lot of people that I rely on to for advice and whatnot. I guess I’ll answer that question in two ways. Books, I like to read. I enjoy any book that kind of delves or provide some insight into the business behind the business. I read all… The Accidental Billionaires, and Hatching Twitter…

OWEN:       I love that book.

CALVIN:     Yeah. I think Hatching Twitter is a great story of a start-up company because it really provides insight into the fact that sometimes the business that you are starting with or the concept that you are starting with isn’t necessarily what it’s going to be by the time it’s done. I think they started with a podcasting service and ended up with Twitter. It kind of…

OWEN:       Evolve…

CALVIN:     …makes the point that if you’re doing something and it’s not working, you can either pack up and go home, or you can adapt and overcome. I think that book provide some good insight, that those guys did that. I think that’s super important. But I think more than the books or more than mentors, for me the most important thing that I’ve used a learning tool is just experience, and really being aware, and trying to reflect on the things that have happened and why they happened. Really using experience to learn from. Not necessarily to be off-putting. Sometimes your failures or things you didn’t do write can be kind of like, “I don’t want to do that again.” But for me it’s always been like what can I learn from that.

OWEN:       Every failure is what you can learn from it is kind of what you’re saying?

CALVIN:     Right, exactly.

OWEN:       If we just talk about all the steps you do and leave it at that it makes it look like it was just all magic. But the reality is that there were challenges that you went through that you actually experienced. At the time you were actually trying to create systems for the business. One of the things I want to do is talk about what hose challenges were and how did you solve them.

CALVIN:      For us, and this applies to I think to anytime you’re trying to incorporate or implement any thing that’s new. You’re going to have a pushback, you’re going to have people that don’t want to or are reluctant to adopt any new system. I think for us, the biggest challenge to systemizing, aside from coming up with how to do it,  but once all that was done was implementing it and getting people on-board with adopting this new technology, new processes and procedures. One of the things that made it hard was we were very young. I was 23 when I started this and I didn’t have a lot of experience. A lot of the guys that were working in our office were friends. And you go from this fledgling company that’s a shorts and t-shirt kind of business to something that’s…

OWEN:       Suits and pants.

CALVIN:     Right. We’re still not there yet. We live in Florida so it’s really hard to get anybody to wear suits and pants.

OWEN:       Oh, awesome weather.

CALVIN:     But to a company that all of a sudden has a procedures manual and has this new technology that people are required to use. So the hardest thing for us was just getting people on-board with it. And the key to that was, one, finding an early adapter. Finding somebody to take it on be the example. I think that applies across the board. If other people are looking at somebody having success with something they immediately want to join in on it. And then the second part of that was just taking away all the old tools and resources.

OWEN:       Those stuff. Just get rid of it.

CALVIN:     Literally, we spent 3 months trying to get people on-board to adopting our software. We still have people using Adobe Writer to write their contracts and the calculator to analyze deals. And we literally had to go to every computer and erase the program, and take up all the calculators, and throw the book in the trashcan…

OWEN:       You burned the ships.

CALVIN:     Yeah, it’s that old. If you want people to stick on-board, throw half the food often, you don’t have a choice you’re staying. But that was the biggest challenge for us, is just getting people on-board with it and making sure people started using the program. And the other part of that is we had to integrate everything into the system, and that was another big part of it. We still had some stragglers that were not adopting. As soon as they realize that our payroll and everything was going through the system, if they didn’t use then we weren’t going to know they closed on a deal. Then they weren’t getting paid, and the rest of the people that were left immediately jumped right back on-board. Go ahead.

OWEN:       Were there any other challenges that we’ve not talked about that you experienced at that point with regards to trying to systematize the business back then?

CALVIN:     Yeah. Obviously, for us…

OWEN:       If it comes to you later it’s okay.

CALVIN:     There’s broad challenges like one was, it seems a simple one but we had this grand plan, this idea for this big software system that was going to revolutionize our company. But none of us were computer programmers so we had no real skill set to build this thing. We had to go out and find somebody to do that. In the beginning we didn’t really have a ton of money. We didn’t really have $100,000 or $50,000 to dump into a project. So we ended up finding a friend of a friend who cut us a really good deal. And we got a huge, big expensive system done for really cheap. That was a huge challenge and it’s kind of a broad challenge but it was a big one for us.

OWEN:       What I glean from that too is that if you’re trying to systematize something, part of the process of trying to make that engine happen you run into other challenges. Maybe trying to learn something new just to make what you want to do happen.

CALVIN:     Right, exactly.

OWEN:       I’m also curious, given all those challenges that you had to deal with, how are you why do you even stay committed to the goal? There were so many challenges but yet you stayed committed. So we’re trying to figure out why or how.

CALVIN:     I think in anything you do, commitment kind of precedes success. For me, I don’t know where I read or heard it but it’s something that’s always stuck with me. You basically put your back against wall, don’t give yourself the option to fail than you’re more likely to succeed. It was a passion thing for me. I really want to make this happen, but what was also not wanting to fail. I always lived by the phrase, you can’t be scared to jump but you got to fight to not fall. It wasn’t anything other than just really not wanting to give up and seeing the opportunity and continually wanting to take the next step forward.

OWEN:       Yeah. We’ve talked about how the steps you took to systematize the business and also some of the challenges and how you dealt with them. So, at this point in the story now I want to find out at what point did you feel like the business was systematized and was able to run without you? Do you remember the point in the story where you felt that way?

CALVIN:     Yeah. We launched IHD tools which took care of the task side of the business, which was a huge help and a huge step in the direction of automation and really getting it the kind of run on autopilot. It wasn’t until we sat down and started to provide job descriptions to people really convey to people what was expected of them, what their role was did things really started to… Okay, we don’t need to be here as much. I don’t need to be as involved in each and every one of these transactions I used to be. That was a big part of it, just making people aware of what is expected of them and then giving them the tools to achieve that. That was huge. The second thing that was big was experience, all of this stuff kind of revolved around the idea that we needed to retain people. And as people gained more experience, obviously they leaned less on me as the business owner to help them out with deals and getting things closed. So as our associates gained experience that helped a lot. The third thing was…

OWEN:       I think you mentioned something about self-management and self-tracking tools for each associate at that time.

CALVIN:     Yeah, that was a big part of our IHD tools was just making people aware of where they were at, where they were. We used to keep stacks of paper on our desk and somebody would have to go in and count how many offers they made. And part of the system was to put in front of them in real-time what their production level was. And that helped a lot too. But that kind of goes back to making people aware of what they’re supposed to be doing and then providing them the tools to kind of track and achieve those goals.

OWEN:       Awesome. Now we’ve shared how you systematize the business. I think the listener probably wants to go behind the scenes to kind of look at what are the different parts of the business or the different systems that you have in place in the business. I guess, in order to answer this business I want to pose this analogy. Imagine you have this conveyor belt. On one end of the conveyor belt is somebody who’s probably looking to buy an investment property or whatever. The other part of this conveyor belt is that same person has been transformed into a customer who’s raving and telling everybody about you guys. But when that person goes through the conveyor belt there are things happening behind the scenes in your business to make that happen. What I want you to do is give the listener a kind of that behind the scenes. What’s going on?

CALVIN:     Got you. I think we talked a little bit before that we operate with two different departments for a lack of a better word, and the first is acquisitions, and the second is sales. Our acquisitions department again is kind of like manufacturing for us. They go out, they identify, analyze, negotiate, and package these deals. It’s the same as somebody putting together a computer, that somewhere behind the scenes somebody goes out and collects all the pieces and parts, puts them in a case, snaps it all together, and puts it in a box. So that’s a big behind the things that happens for us, is the actual process of going out and finding and analyzing these deals. Hopefully that answers your question.

OWEN:       I’m trying to really piece it together. So there’s a part of it where people are going out there to find the deal. So you have a system for that. So they’re finding the deals. When the deals come in, I’m also curious, there’s must also be another part where you guys are actually turning those deals into something more profitable. Maybe it’s by rehabbing them or whatever. And maybe there’s another part where you guys are selling. I’m just trying to give the listener kind of a whole picture of what’s really happening.

CALVIN:     Right. I’ll start at the beginning. Once we package this property, we put a mark-up on it and we in turn sell it to one of our clients. I’m not really following your question…

OWEN:       Okay, let me see if I can make it clearer. Going back to what the business model is that you’re finding properties and then you do rehabs to these properties. Is that the case?

CALVIN:     No, we don’t do any work to any of the properties. Our service is providing our clients with off-the-shelf experience when it comes to buying an investment property. So they actually don’t have to go out and find these deals, or analyze these deals, and put together data, and put together all the analysis, and negotiate. They come to us and they literally… If you ordered to buy a TV, you could go out, fly to China and you could buy all the pieces. And you could ship them back to the States, and you could assemble it all, solder all the wires, and build a case for it, plug it in, and then watch it. At some point somebody figured out that wasn’t a very efficient way to do things. So people started manufacturing TV’s, and then they figured out that it’s probably not very efficient for us to sell these TV’s ourselves so we’re going to sell them to Wall-Mart and Wall-Mart’s going to provide the off-the-shelf experience for buying that TV. If you apply that same concept to real estate that’s exactly what we do.

OWEN:       Awesome. Thanks for clarifying that. I think we kind of talked about the systems you have in place. I asked you what systems you have to enable your employees to know exactly what to do and what they’re doing. I think you mentioned the job description thing, the software you guys had in place. I think one thing that we didn’t talk about was kind of how the employees hold themselves accountable.

CALVIN:     Right. They all have goals that they’re encouraged to strive to achieve. We have an incentive plan that forces each individual person to hold themselves accountable. It’s a group incentive plus an individual incentive.

OWEN:       How does that work?

CALVIN:     How does this work specifically, or how does it work…

OWEN:       Yeah.

CALVIN:     Basically, we set revenue thresholds and if the group achieves that revenue threshold then they get a bonus. And each of those revenue thresholds for the group has an associated revenue threshold for the individual. If the individual achieves their revenue threshold in that particular month then they get a bonus.

OWEN:       Awesome. You might have also talked about this in regards to tracking and verifying of results that the employees deliver. Is there anything else regarding to how you guys track and verify results delivered by your employees that you want to share?

CALVIN:     Hopefully this answers your question but this is something we spent a lot of time working on. And this is something that we’re actually, currently working on getting better at. It kind of goes back to that breaking things down and looking at what goes into success. Once thing we did was we sat down and we said, “What kind of input do we need to do to get the desired output?” Based on that we set goals for everybody and then we gave people the tools that they needed to kind of visualize and track their achievement of those goals.

OWEN:       One of the things I want to find out is now that you’ve systematized the business and its automated, and it runs without you like we’ve established so far. You have more free time and I’m curious, which areas of the business do you now focus on and why?

CALVIN:     Right. There’s 2 main areas. The first is obviously, this is a constantly evolving process. The worst thing you could do is rest on your laurels and think that you’ve got everything figured out because you never have everything figured out. I spent a lot of time trying to figure out how to get better. It causes a lot of stress on my end sometimes because in order to do that… Ambition has this funny way of making you never satisfied. Sometimes taking your focus off of the good things that are happening and putting it on, how can I get better, how can I get better, how can I do more. But I guess  that’s ambition so you got to deal with it. So I spend a lot of time just trying to think about ways that we can get better. In fact, I come up with things all the time. Some of them are great ideas, some of them are not. Yesterday, I came up with an idea that I thought would really help. Today, I sat down and I worked on implementing that idea. A lot of my time is just spent on, now that I’ve alleviated myself from having to do all these other stuff. I can worry about what are the new things that we need to worry about, what are the new things that we can get better at. And really striving to get the perfect system in place. And that’s the first thing that I do.

OWEN:       Now you’ve piqued my interest. Is it possible to share that idea with us? What is that?

CALVIN:     Yeah, basically our tracking system. We associate or assign a status to each property. So basically when an associate identifies a property that’s a potential investment deal we classify that as a lead. And one of two things is going to happen. They’re either going to analyze it and realize that it probably isn’t worth their time to pursue. Or they’re going to analyze it and realize that this is worth making an offer on. Let’s see if we can make a deal happen. We assign a status to that, either tracking or offered. Once that offer is made several things can happen. They can get rejected, they can get calendared, they can get accepted. Once it’s accepted several things can happen. We basically have one row or one finite set of statuses for each property. And we use that status to place each property in its correlating spot in each associate’s pipeline in other words. So yesterday I realized that… It’s done a great job and also it doesn’t allow us to look at how many offers we made versus how many of those offers turned into actual deals, versus how many got rejected, versus how many we got countered on. By only having one status, once you move the status from offer to tracking, or tracking to purchase, or whatever, you lose the status that happened before that. So what I came up with was offering a primary status and a secondary status. And which would allow us to track the initial offer and then what happened after that initial offer was made. And I think it’s going to help us. At the end of the year we sit down and analyze our input and our production level for the year. We don’t have any way of knowing how many actual offers we made. Because once somebody moves the status offered now it is forever something else. That was a big…

OWEN:       Insight, yeah, I like that.

CALVIN:     Yeah, insight. I have developed a few programming skills over the years from all of this. So I was able to go in and…

OWEN:       Basically, the property is going through different stages, right? And then in each stage, if you move it to the next stage I guess kind of lost what properties he had before. But I think now based on that insight you’re saying, “Why don’t we just carry those properties that it had in each stage with it as it goes through each of the stage. That way in the future you can come back even when it’s closed and see all the different stages, the properties, and data that as involved with it.

CALVIN:     Yup, that’s exactly it.

OWEN:       I’m curious, what is the next stage of growth for the business and what big plans you have?

CALVIN:     The next plan for us is to scale. We’ve spent 7 years building the system. And we’re at a point where we have things running pretty good. So the next step is to scale. I’m working on 2 different strategies for scaling the business and growth. One is actually kind of a different business model. And we’ve kind of had a soft launch of this system. January 1st, we’ll have an actual, full launch. We should be fully operational. But we’re building an auction platform, a listing platform that will allow investors and sellers of investor grade properties to connect and transact business. We feel that the future of real estate is online. Currently, you have a lot of online marketing. I actually believe that the future of real estate transactions is going to be online. The banks have kind of set the standard and example for that through sites like auction.com and LTsource that are specific to bank-owned properties.

OWEN:       Yeah.

CALVIN:     We want to apply that same strategy and make it available to the individual seller. So we launched the site about a month ago called vestveu.com that we hope will provide that platform and help take real estate into the future. That’s a big part. A big part of what we’ve been doing with my free time over the last year is developing that, and we’re excited to see that get off the ground and see where it takes us. The other side of that is taking the tools and technology that we’ve built that allow us to operate. And figuring out a way to either franchise those tools or make them available through some sort of fee-based subscription, similar to your system.

OWEN:       You mean like taking the software you’ve built and turn it into something where other people in your field can actually use the software. Am I getting that right?

CALVIN:     100%

OWEN:       That’s not bad. That’s a good idea. That’s great, I love that. As we’re rounding up, can you summarize… Because the person who’s listening to this is probably at that point where they want to systematize their business and have it so it runs without them. What will you say will be the summary of what you’ve shared so far. That way they have quick bullet points as to how to transform their business so it runs without them. Just a summary.

CALVIN:     Yeah. The most important thing is, again, going back to really, the ability to disassemble your business. Take the parts, analyze them separately, and start identifying points of automation and areas in which you can make things more efficient. That’s where it all begins. It takes a lot of thinking, reflecting, and analyzing. But it’s well worth the time. It ultimately is what a business is made of. To me a business isn’t somebody sitting at their house, basket weaving and selling them on Craigslist. To me a business is something that is scalable and something that is more than the individual proprietors that’s running the business. In order to achieve that we really have to be able to systemize and put the process behind a business. Without that you don’t really have a business.

OWEN:       Awesome. Is there a question that you are wishing I asked you during the interview that I didn’t ask you. And if so, post the question and the answer.

CALVIN:     Part of your pre-interview was a story of how it got started. So I kind of wish you would ask me that because I put a lot of time into thinking about that.

OWEN:       Just go ahead and talk about how you quickly got started.

CALVIN:     Yeah. I’ll give you the abridged version because there’s a lot of things that go into it. And that could be a whole another topic of discussion on what you learned from dealing with people. So basically I graduated college in 2006. I’ve got a degree in real estate which was not my first choice but it’s kind of where I ended up. Got right out of college, it was 2006. I don’t know if you’ve ever seen Boiler Room but that was the job fair that you were going to. That was the environment. “You’re going to make millions of dollars and you’re going to be the most successful person in the world.” It was crazy. I took a job with a national real estate investment firm, moved to Orlando, slept on a buddy’s coach for like a month, started making a little money, got my own apartment. I was doing really well. They had a really good promotion plan that I was quickly working myself through. Then late 2007 things kind of started taking a turn. The economy started kind of teetering over the age. The buzz around real estate kind of started to fade. So myself and 4 other colleagues got the idea to jump ship and start our own company. At the time we weren’t really thinking of it in the sense of the company, it was more like, “You buy a house, I’ll buy house and we’ll split the profit. We’ll make more money working for ourselves than when we working for somebody else”, which is kind of cliché but I guess every entrepreneur gets started that way. We had no business, no money, no business plan. We’re being threatened with a lawsuit from our former employer for leaving. And looking back this was insanely irresponsible, advising not to quit their job with no money and try to start a business because it’s very difficult. It is not something that’s for the faint of heart or for somebody that’s not fully committed to succeeding. But I guess at the time I was young and living on the edge a little I could survive on ramen noodles and soda. I guess every entrepreneur kind of has the same kind of story. I guess most probably attribute their willingness to take risk to their success. So basically we started working out of my living room. We had, again, no business plan so we spent the first couple of weeks kind of coming up with a loose business plan and decided that we needed to rent an office. That was partly because of our business plan and partly because we came home one day and found our old boss sitting on our couch in our living room. So we thought we probably want to relocate. We don’t let this guy coming over in the middle of us trying to operate and disrupting things. So we scraped together a little bit of money. We borrowed some money from one of the partners, dads. It wasn’t much but it was enough to get us a little 500 square foot, one room, little office in downtown Orlando. As we were signing the lease, crazily enough we had no office furniture. We literally had one computer between the 5 of us. The landlord was like, “Hey, by the way, the guys that moved out left a bunch of office furniture in the storage room next door, you guys are welcome to it.” So we’re like, “Yeah, sure.” Like no joke there was 5 desks, 5 chairs, 5 computers, 5 phones, a printer, a giant white board. It was literally like everything we needed to get an office set-up and start going without…

OWEN:       And that was basically the starting point of the business. And that basically takes us all way back to where you now started figuring out that you needed to build systems. I like that. At least we give the listener an insight as to how it got started. What will you even say is the best way for the listener to connect with you and thank you for doing the interview.

CALVIN:     Yeah, no worries. They can go to vestvue.com. And they can find our information there. They can also go to investmenthomesdirect.com. They can also email me at calvin@investmenthomesdirect.com.

OWEN:       Awesome. Now, I’m speaking to you the listener. If you have enjoyed this interview, obviously, you probably have been listening all the way to this point. So if you want to subscribe to our podcast, that way you get notified when we have new interviews. To do so, if you have an iPhone you can go to sweetprocess.com/iTunes to subscribe to the podcast. If you have an Android you can go to sweetprocess.com/stitcher to subscribe via the Android phones. If you’ve enjoyed this interview, obviously you have friends who will probably enjoy it too. So feel free to share the interview with them as well. Finally, if you are at that point in your business where you’re tired of being the bottleneck and everything just remains in your head but you want your employees to know step-by-step how you get tasks done, I want you to sign-up for a free 14-day trial of SweetProcess. Calvin, thanks for doing the interview.

CALVIN:     Yes, sir. Absolutely, anytime.

OWEN:       And we’re done.

CALVIN:     All right.