How to Build a Scalable Real Estate Business (While Working a W2!) in 2025
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What does it take to grow a thriving real estate business, build systems that scale, and develop the mindset to overcome challenges? In this episode, Steve Rosenberg shares invaluable lessons from his journey that you can apply to your own path, whether you're building a portfolio, starting a business, or working towards financial freedom.

Steve's going to break down how to create systems that save time and make money, the importance of mindset in navigating failures, and how you can turn challenges into opportunities. This episode isn't just about his story. It's about the tools and strategies that you can use to achieve your own success. If you're ready to level up your real estate game and entrepreneurial mindset, this one's for you. ♪

Welcome back to the Real Estate Rookie Podcast. I'm Ashley Kerr, and I'm here with Tony J. Robinson. And this is the podcast where every week, three times a week, we bring you the inspiration, motivation, and stories you need to hear to kickstart your investing journey. And we are super excited to welcome to the show Steve Rosenberg. Steve, welcome, brother. Super pumped to have you, man. Great to see you guys, as always, my good friends. And I always enjoy these conversations. So I'm

Hope you guys had a great holiday, great new year and ready to kick it off. Yeah. So we thought we'd bring on Steve to start off the new year of 2025. Before we get into mindset and how rookie investors can really get a great kickstart to their goals for the year. Tell us just a little bit of background about yourself. So my background, probably like many people on this call, I have a regular, we'll say regular nine to five job. I have a career, still have it. It's being an airline pilot.

I got involved in real estate way back after 9-11 when I got furloughed from the airlines, started investing in real estate. I did flipping, wholesaling, buy and hold, and I parlayed that into eventually owning a property management company that we grew to over 1,000 properties and

We ended up exiting and selling it to a venture capital firm. I still own real estate to this day. I'm still heavily involved, you know, speaking at events, helping coaching people and all that stuff to understand how to grow and scale to where you want to go. That's the quick version, we'll say. Yeah. So to better explain this, I think for you, Steve, is to

How you relate to a rookie investor is like you were investing in kind of the slums, like very, very not nice neighborhoods at all. And out of necessity, you and your partner had to learn how to be property managers and eventually used all the tools and resources now that you have to kind of build up this large property management company and then sell it for millions. So

Whether you're just an investor looking to buy your first deal, you want to start your own property management company or whatever your goal may be. Steve has achieved such great success that we're going to dive into what are some of the things he has learned throughout his experiences that can help you and maybe give you a shortcut so you don't have to go through all the trials and tribulations and the pain that Steve did. Yeah.

I, you know, it's a good point, Ashley. I mean, listen, we don't know what we don't know. And sometimes some skill sets don't transfer. And being an airline pilot, knowing systems processes, there were some things that transferred and some things didn't, meaning owning real estate, understanding numbers, understanding the market.

And real estate has a way of coming like a wrecking ball through your front door to correct your mistakes that you've done incorrectly. And I was not immune to that. My business partner and I, we had a lot of houses that we purchased. I don't want to say we purchased them incorrectly. I think we put the wrong business model around those types of properties.

Every property is four walls and a roof. It doesn't change. It's the business model that you run inside of the four walls and the roof, whether it's a short-term rental, long-term, you know, BRRRR, whatever it is, that's the model. But the four walls and the roof, when you sell it,

It's still four walls and a roof. It's just the next business model someone else is going to run. And we did not have the correct model. And it very quickly showed us why. And so I am not immune. I'm very vocal about my mistakes because I think we learn more from our mistakes than we will our wins. But I would tell everybody here that's starting out what everyone on this podcast has in common with self-made millionaires is

is that we've all started from zero. We all started from zero and didn't know what to do, but the difference is the action that was taken from that zero moment. That is really it. When you think about it, like you guys, everybody here, we all started from zero and we made decisions and we took action.

There's a cost for action and there's a cost for inaction. The question people have to ask themselves is, is the cost of inaction greater or less than the cost of taking action? And to me, just like you guys, just like people you've had, to us, the cost of inaction was much, much higher than taking that action. Steve, dropping gems already. And I definitely want to get into some of the mistakes. But before we do, I guess just as we look at 2025,

Again, a lot of the folks listening to this podcast, they're, they're Ricky investors who maybe have done a deal or two, or they're maybe still on the sidelines waiting to get started. So what do you think is the most important mindset shift that someone listening to this podcast needs to make to really jump into the world of real estate investing in 2025? That's a great question. If we go to the root of the problem of the issue that we have is that people, they sometimes use a tactic, right?

and a tactic is something that's a moment in time. It changes with the environment. For example, Ashley lives in New York.

Using water skis in the winter is the wrong tactic. So there are things that she cannot do with water skis in the wintertime because it doesn't work. You would need another tactic, which are snow skis. The reason I bring this up is real estate, there's tactics in the cycle of real estate. There's buying, there's selling, there's holding. Different tactics for different seasons in the real estate environment.

And so there's many people out there that are using tactics that maybe were a prior economy, was a prior time. As we know, we all know COVID, and that was a tactic. And we all know many people that are still trying to use that same tactic moving forward.

And so if you're using a tactic from the past, assuming it's going to work moving forward, it's like actually using water skis in the middle of winter. It's not going to work. It's the right idea, but it's the wrong season to use them. And so, first of all, I think we have to understand that real estate is always changing, just like the weather, just like the environment.

The key, I think, and what I've learned from my many mistakes is we have to start with the end in mind and reverse engineer what we want. So the challenge many people have is we identify as real estate investors, and that's our identity. And we don't know the reason we're buying the real estate is the next step. And I think that we have to understand that owning real estate is owning a business and

And that business has to have an end destination of why are you buying that property? Why are you flipping it? Why are you doing burr? Why are you doing this? And does that align to your destination? So my roundabout way is you have to build a destination before you ever get out of the house. And many times, and listen, I did the wrong way. I just started buying deals online.

And I didn't know where to go and what to buy because I was just buying deals because everybody said, Steve, just buy.

Well, that only works until all of a sudden you run out of gas on the highway and you're like, what am I doing? It didn't align with my destination because I never picked it. And that's where I think a lot of people need to start. You've got to start with the end in mind and reverse engineer everything that you're doing. Rookies, we want to hit 100,000 subscribers on YouTube and we need your help. While we take a quick ad break, you can go over to youtube.com slash at real estate rookie and make sure you're subscribed to the channel.

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All right, welcome back to the show where we're joined by Steve Rosenberg. So besides figuring out what your end destination is, what are some other common mistakes that new investors are making when they're trying to figure out their trajectory? Well, first of all, I would say they listen to the static. They listen to the noise that's out there.

and they don't have their own guiding light. And the guiding light should be the numbers. The numbers always dictate the deal, not your emotions, not your gut feelings, not whether you or your wife would live in the house. It is the numbers. The numbers are the deal.

And so a lot of times, and again, I know all these because I did them wrong. I had my opinion on these deals and I would talk myself into deals saying, well, I could probably get more for rent. I could probably do that when the numbers clearly did not dictate that. But I was so set on trying to buy as many deals as I could.

I was like at the buffet and my plate was overflowing. And I was like, keep piling it on, keep piling it on. And so the mistake we have is we don't listen to the numbers to actually tell us. And like I said, I did this many times and it bit me very, very hard. And so I think the mistake is, you know, you have to have a foundation, right? So when you look at the foundation of a business, right? Because everyone's a business owner. There's five pieces. It's kind of like,

Like if you were going to build a house, you wouldn't build the house first and then go, Tony, dude, we forgot the foundation. Nobody dug the foundation. You'd be like, well, no, Steve, that's stupid. You have to have marketing. You have to have sales. You have to have operations. You have to have financing and you have to have leadership, right? You have to have those five things as your foundation of your house for your business.

That's the root of everything that you do. And so if you want to go vertical, you've got to go down before you go up. And so and the reason I again, economic times, tactics change when tactics change, the house starts tilting. And when it starts tilting, that's when all of a sudden you go, man, I can't rent this out. I can't do this. I can't do that. It's like, well, you didn't have the right foundation because you didn't base it on numbers.

So that's my long answer for that. Well, to kind of coincide with that is, can you give us an example of, you know, in your investing journey or even the property management company where you made a mistake like that and how you were able to pivot or self-correct? Yeah. So, you know, we had our management company and to be completely, you know, transparent, our properties were so bad that no management company wanted them.

That's why we had to start our own management company, because we had about 35 houses in the ghetto that, you know, cash on cash return was going to be 60 percent. That never happened because our tenants were staying about eight months and our maintenance costs were three times the amount. Because when they left, they would take party gifts with them, like wiring, electrical. They take plants. They take light bulbs. I mean, we'd walk back and it's like the house was the shell.

And we kept doing it over and over again. Like that's the definition of insanity. We kept doing the same thing thinking this time is going to be different. And when we started the management company, we, we, we, we started getting on new clients. And what we found was we were our own worst clients. Like we were the worst clients of the company and it was our company. And our property manager was like, you guys need to be fired. And we're like,

Like what we own the company. She's like, you guys have the worst portfolio. You guys are the worst just because of our vacancies. And I mean, we would put the capital expenses in, but it was just, it was never going anywhere. And I remember one time we, we sold a property. We're losing money. Like the house costs $50,000, right? It wasn't even an expensive house. We're like, okay, how hard can you get hurt from a $50,000 house?

We went to closing with $10,000 to pay to get out of that deal when it was all said and done. And you know what? We were the happiest people there because it was no longer our problem. Because what I'll say is when you buy a bad deal, what people don't factor, the finances, yes, that sucks. It's the mental stress that laying your head down on the pillow at night going, what am I going to do? Now imagine you have 30 of them and you put yourself in that position.

So I just tell people the stress of getting out of those deals, the way we got out of them is I sold them owner financing to investors from Canada that didn't have the ability to get a loan. So I carried the note. I sold an owner finance and I managed the property. So I had to create a creative way to get out of the deals. They got properties. They were happy. We were happy because there were no longer our problems. We were still making money by managing it. And that was a creative solution.

But I tell people all the time to get out of a bad deal is the worst nightmare when you put yourself into that deal because you did it. And again, I know because I did it and it is not a good feeling. So I tell people all the time, if there are any red flags when you're looking at a deal, you're much better backing off. I mean, there are millions and millions of houses across the United States that

The odds of some being bad deals are pretty high. If you know what a good deal is. Now, that property that I sold and went to closing and paid $10,000, I saw the guy a couple years later. And I'm thinking, man, this guy has got to be drowning. Like, ha-ha, right? So I meet up with him at an event. And I'm like, hey, man. I'm like, how's that deal?

And he's like, bro, that's the best producing property I own. And I'm like, what? I'm like, shut up. He goes, I swear to God. He goes, that makes me the most money. I'm like, there's no way. I'm like, that address? He's like, yeah. I go, he goes, Steve, you are not running the business correctly. You tried to run it this way. That is not the way you run these types of deals. You have to run it this way. He goes, you were running the wrong business model. That's why it would never have worked for you.

And I was like, huh? He goes, we just have a recipe for doing successful deals in this economy or in this market area of price point. He goes, the way you were doing it was never going to work. You were trying to run a high-end property in a low-end market. Wrong business model.

And that was a big aha for me. Like, wow. That's gotta be the person listening right now that bought Tony's house in Shreveport. That's saying, Oh, this is my best report. Just real like backstory. The second deal I ever bought very similar to yours. Wasn't in a bad area, but you know, we had some instances there, but we ended up losing, I think all in all about 30,000 bucks on that deal. We also had to write a check at closing to get rid of it. Taught us a lot of lessons, but I,

I would be curious, the person that bought it, like how that deal has worked out for them. Because you're right. Maybe I just had the wrong business model on that property. And that's why it didn't work out the way it should have. Yeah, Steve, I think you hit two really key points right there. The first one is maybe you have the wrong business model or

Maybe that business model isn't even for you. And the second thing was, if there's red flags, it's okay to back out of the deal. It's okay to not do the deal. And it took me a really long time to be okay with that. The first deal that I ever backed out of, I had put my earnest money deposit in. We had passed the inspection period.

And there were some things that made me just not want to do this deal anymore. I was getting uncomfortable. And instead of, you know, I lost, I think it was $2,500 on my earnest money deposit. And I was like the lab that they copped it because I felt so bad. I was like, this is the least I can do is let them keep it because I was backing out of the deal. But after that was done, after I took that action to say, okay, I'm stepping away from this deal. It was the biggest relief.

If I would have gone through with that deal just out of principle of never having to back out a deal, I'll always close, that probably would have lost me so much money looking back now at the history of that property now and what would have came out of it, how the market would have changed, and it wouldn't have been a good deal. So it really took me a while to be okay with that as

it's okay to not do every deal. Like there are times where there are going to be red flags and to back out. And I,

feel a lot more relief with that decision I made than if I look back now. And yeah, there may be times you do actually have regret, like, oh my God, I should have went through with that deal. But that's going to be way less painful than losing hundreds of thousands of dollars because you did get into that. Yeah. And listen, I have learned ego and pride are success inhibitors.

You know, there's many deals that I chose not to because I was too proud. And there's a house by my house, actually, you know where I live. And I have to drive by this house. And what the value of this house is today, it just kills me because it's just gone through the roof. And I'm like...

I went to those crappy houses and I did not do this one. And every day I drive by this house and it reminds me that I was too prideful. I thought I knew too much. And, you know, I remember when I, you know, the, the, the value of lessons, right. I remember when I, when I, one of my mentors and he was charging like $30,000 for, for mentoring, you know, and that was a lot of money. It is a lot of money still. And I was like, man, I'm like, that's a lot of money. Like, that's a lot of money to, to, to invest with you.

And he laughed and he goes, I see. He goes, you think that you're not going to spend this money? He goes, you're going to spend it either way. You're either going to spend it with me and bypassing the mistakes that people have made. He goes, or you're going to spend that if not double or triple on your own in mistakes, but it's going to be stretched out for 10 or 12 years. He goes, make no mistake. You are spending that money. And I was like,

Oh, he goes, you think you have a choice? He's like, there's no choice in this conversation. The question is, is do you value money or time more? And I was like, that's a good point. I never thought about that.

So that was the eye-opener for me. Yeah, that's a big mindset shift. But I guess on that same note, Steve, right? Because you scaled up your own portfolio, you scaled up the property management company, and a lot of the folks in the Ricky audience are also looking to scale. I guess, what have you seen as maybe the key to successfully scaling? You already talked about some of the challenges, understanding the right business plan for each individual property. But if someone wants to go from one to five, from five to 10,

Systemically, what should they be focusing on? Yeah, listen, I think the first thing is just taking action, right? It's really simple. I talk to so many people, as you guys do. I get thousands of people that reach out to me all the time and they're asking me questions like, what do I think? I'm like, just take action. Just do something. Like, well, I don't want to mess up. Well, I guarantee you, you are messing up by not doing something.

And so again, I just, is the cost of action more or less than the cost of inaction? And the thing is, is you are one decision away

from changing your life. And that decision is taking action. I would say that the tactical thing is just start looking at properties that are in your area, start running comps, and don't do two or three, do two or 300, do 100 a day. It's kind of like when you look at all the professional athletes, what is it that they do all the time? They practice the basics. Michael Jordan would practice eight hours a day, every day for a two-hour game.

He was the best athlete ever. Was it because he practiced or did he have natural talent? Probably both. But he wasn't born with that talent. He got cut from his ninth grade basketball team, which tells me that you have to take action. And so, listen, first you got to know, like, well, see, should I do apartment complexes? Should I do shelf storage?

I don't know because I don't know where you're going. So, you know, again, it's like, well, what should I do? Depends on the goal. And these can be many stages. They can be one-year goals, five-year goals, 10-year goals, generational goals, right? All right, guys, we need to take our final ab break, but we'll be right back after this. Hey, guys, it's Mindy from the BiggerPocketsMoney podcast. If you're anything like me, you've got a lot on your plate this year. You've got summer beach trips to plan, a work-life balance to balance, and you've

Thank you.

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Okay, let's jump back in. One last follow-up to that, Steve, because you talked a lot about shifting strategies based on where we're at in the market cycle. And I'm not asking you to break out your crystal ball, but as you look at 2025 with where we're at with interest rates potentially coming up,

coming down we actually just saw the fed drop rates by i think a quarter point today but rates could potentially be coming down um inventory could maybe start to creep back up but what are you seeing strategy wise we have flipping we have wholesaling we have the burr strategy long term short term midterm small multifamily big multifamily office space what what do you see as the kind of trends and where should rookies maybe be focusing let me just say this right i think it's a

I'm going to say something and then we'll get into that. I think the first thing we have to remember is that when, you know, we, the election just happened, which I think we can all say there is going to be a new economy. And with that economy is going to be a new era, which means you have to have a new mindset. Now,

What I'm a big believer in is that with this new mindset and new economy, the challenge, I will say, whenever I go speak at real estate events or mastermind or speak on stage, especially with real estate investors, and I'm not sure why, but real estate investors have a challenge with identifying what they do. And that's like a hammer.

So all they're looking for is nails. They've got to find a nail for their hammer. That is it. There's other deals that are crossing their plate, but they don't see it because they're a hammer. Then you've got another guy that's a long-term rental. He's a rake. He's looking for leaves to rake up, and he's not looking at anything except he's looking down for rakes.

Everybody is a tool, but if you know all the tools and you have them sitting in a toolbox, when the deal comes across your plate, you can go, you know what? That's a subject too. I'm going to grab that wrench and I'm going to work that deal. You know what? That's a flip. I'm going to grab that broom and I'm going to do that deal. So,

I think instead of identifying a specific tactic, I would say take some time and learn and fill your toolbox with the knowledge to make those smart decisions. I'm sure all of us and many people, friends that we know, we can look at any deal and say, that's what I would do with this deal. That's what I would do with this deal. That's what I would do because we have experience, because we've taken the time to educate ourselves. And I think one of the things we got to remember is

A lot of people, they look to the fast track. And I'm kind of going with where your question, Tony, is like, when people are looking for the fast track, I think that's a recipe for disaster. And we will pay more for the fast track, right? I mean, think about it. If you take a gym membership, that's $100 a month, and you take liposuction, which is $20,000, they basically do the same thing. But liposuction is done in an hour, and a gym may take a year.

but people will pay more for the liposuction because of speed. And so we have the same mentality that we will pay more for that speed, but we don't think of the consequences as to number one, is this right for me? And does this person have good intentions or are they taking advantage of me? And I think real estate has a challenge where

It's really, listen, I know there's laws and rules and I get that and there should be, but it's really buyer beware. And I think you have to be cognizant that when you get in a deal,

And we've all gotten in bad deals, all of us, right? Myself included. But it's kind of on me, right? We're big boys and girls. We buy a bad deal. We have to own that. And we have to say, you know what? That's on me. I bought a bad deal. But I was smart enough to understand how to get out of that deal after. And I think the challenge, Tony, is there's going to be a lot of people pushing things on social media that, oh, this is the way you go. And if you don't have the education, you're going for the liposuction, and it may not be what you think it is.

And you're going to go like, dude, I'm fatter than what I do in. I don't know what to do now. Like, this is not work. And it's like, sorry, buyer beware. That's on you.

So I don't think one way would work, but I just think education, I just, I've learned that if you have the education, man, and that's what I think BiggerPockets is great at, is educating people to understand what is the best strategy so that they don't get caught and they don't get hurt financially. And I think too, as a real estate investor, you have to continuously keep learning. Even if you are using the same business model and you have it down pat,

is if the market changes like I

Every single day I get a newsletter that's it's got a little ticker at the top as to what the current mortgage rates are, what even the stock market is doing. And then just here's the economic news for the day, too. So there's so many different things you have to be educating yourself on and staying on top of and not even just learning new skills and new strategies, but also to stay ahead as to

What are some of the advantages that you can have by learning some things? Like having an AI leasing agent is now coming into some property management software. So Steve, along those lines are what,

What's some advice you can give to rookie investors if they are going to be the property manager for their properties as to how they can kind of stand out and automate systems? What are some techniques or things that you did to kind of stand out as a property manager? Sure. So when you look at property management, there's systems, right? Like any business is a matter of systems and being an airline pilot and being, you know,

trained in systemization and checklists and all that stuff, there's going to be about eight to 11 systems in property management. Could be as high as 19, but there's about eight to 11 standard systems. So you want to make sure that you can do these repetitive tasks over and over again via the system. Because when you start growing and expanding, you've got to understand that you've got to have a process for everything that you do, because not only are there

rules, there's laws and regulations to protect tenants. And if you are not treating everybody fairly, equally to their interpretation, then

there's repercussion to this. There's property code, there's the IRS, there's laws, there's everything that goes into it. And your job as a property manager is to run it right down the middle of what the law says. So, you know, we had a thousand properties, we had a thousand tenants, we had a thousand owners, and we had about 300 contractors. Everybody has a different definition of happiness, right? And they're kind of, everybody's an opposing force. All we could do is run it down the line of having an agreement with

sticking to that agreement, not deviating. The biggest mistake I see landlords make or property managers make is you start deviating from your rules and regulations. And as soon as it's like a pendulum, it just starts swinging and it does not go back and it never ends well. And the challenge is those agreements

repercussions or ramifications when you do something wrong, it gets very, very serious because you have the livelihood of somebody living in that property. And it's not like, well, I just jiggle the handle. That's what you do. Jiggle the handle. It's like, nope, there's what's called property code and there's property code says that. So you've got to make a process for everything. If you were to start at the inception of something,

advertising the property, screening the tenant, denying the tenant, accepting the tenant, doing the make ready, putting the tenants in, setting up the rent, making sure the rent is paid, dealing with service tickets, dealing with delinquencies, evicting that tenant, getting the property re-ready. There's just a process. And if you were to follow that funnel and say, okay, what would I do here? What would I do here? What would I do here?

That's pretty much what a property management company is. It's just a bunch of processes and steps over and over again. So if somebody wants to do this, listen, it's not rocket science, but you've got to make sure that you have processes. As you know, Ashley, I was very big into virtual assistants. 60% of my company operated in Mexico with virtual assistants for my management company. We got so good that we actually opened up a virtual assistant placement company in Mexico because we got so good at disk profiling and right person, right seat.

But it's because we knew the repetitious tasks that had to be done. We don't personalize it. That's why we're able to grow into multiple cities and do what we're able to do because nobody is individualized. Everybody has to run the same way. It's like the McDonald's, the E-mail theory.

So I guess to answer your question, Ashley, you've got to make sure that you standardize everything. It's got to be written. It's got to be documented. It's got to be followed through. Now with AI and virtual assistants, it is so much easier than how we did it. Like we did it with the cavemen, right? We're writing in ash and we're trying to draw it out, you know?

Nowadays, you could do so much. I place virtual assistants for people, and they're like, oh, my God. I tie them up with the AI. They make the process. They make the procedure. We do a loom video. I'm like, yeah, I'm that old guy. You have no idea how hard I had it. It's true, but it's much, much easier. But that comes with a price. Technology goes both ways.

Which means you can use technology, but if you're going to be a property manager, you have to deliver technology to the clients because that's what they expect. So you don't get to use spreadsheets and do snail mail. You've got to have a system to fulfill the contract and to give good customer service with the same technology you're using. So

I don't have that answer to the question. It's not hard. It's easy. And virtual systems are easy to use if you have the right systems wrapped around them. Steve, one, I love that breakdown and love that explanation. One last follow-up question for me, because I think inherently people understand the value of having documented systems and procedures.

I think where they get bogged down is just the pure volume of things that they believe they have to document. So if someone's got like zero documentation, no standard processes, it's all tribal knowledge, how do they decide where to start first? That's a great question. And my suggestion would be is what's on fire?

What is just a dumpster fire in your life or in your business? Start with that and start working out from there, right? You get to the core of the heat of the problem. And I would start with that as the process. And just listen, nowadays, like when I coach people, I tell them like, listen, you can talk into your phone and say, okay, first thing we're going to do is we're going to run an application and we're going to do this, this, this. And you just talk into your phone. You send that to a VA or you upload it to AI and say, create a process for this.

If you did two processes a month, right? That's every two weeks because you've got to live your life. You've got stuff to do. So if you did one process in a week and the next week you're doing it where you're finalizing it, making it pretty. So a week to create, a week to make pretty, a week to create, a week to make it pretty. That's two a month. In one year, you would have your whole business system and procedure eyes.

Now this goes into working on the business and not in the business. So it's a matter of saying, okay, I'm going to take two hours. I'm shutting off everything. I'm going to disconnect and I'm going to spend two hours and I'm going to talk into my phone and I'm going to hand this to my virtual assistant. She's going to load it to AI and we're going to create a process for what is on fire. And what gets inspected gets respected. Meaning now you put a couple of key performance indicators, two or three, you know, how many leads came in? How many did we talk to? Right? Right.

How many people did we evict? How much rent did we get? Very simple. People go over the top with this stuff, like they're launching a space shuttle, NASA. Like, dude, what does all this stuff tell you? They're like, I don't know. I'm like, well, then it's useless. It's worse having too much information than not enough. So put a measurement tool next to each process. What's one thing I'd like to know with this process? I'd like to know how many lease applications came in. That's a good metric. Let's start with that.

So my answer, Tony, is it's inch by inch, right? It's due two per month, one every other week. By the end of the year, you will have a business that's processed and procedurized that you can hand over to virtual assistants because when you hire a virtual assistant, they're going to go,

What do I do? And you're like, dude, it's in my head. You should know this. Like, it's right here. You should understand what I'm thinking. And they're like, I don't get it. They're like, oh, you got to go. You're fired. These don't work. It's like, so that's my answer is it's not as complicated as people make it out to be. Now, listen, you can get up to 20 to 25 processes when you get down into the nitty gritty. But for the basic structure of your business of flipping wholesaling, there's about eight to 11.

And that means within a job, you want to be go gangbusters. You could do it quicker, but if you've got a life and you're trying to get other things done, just do two a month. It's very simple. The thing that I like most about the systems and processes and keeping the SOPs is, is, you know, onboarding more team members. And it's not only if you're training someone to come on, like I have a VA that pays the bills. She goes in, looks at the mail and decides what needs to be paid, where it needs to be filed. But,

But also, too, when you have other people that are coming into your business, maybe another VA, is they're able to see what other people are doing and what their responsibilities. So all of the questions aren't directed at me, that they know exactly who to go to. This is the exact things they take care of, too. So there's so many different uses for building out those SOPs and things.

My first ever SOP I did was how to do a bank reconciliation. And it was you log into the bank account. This is the username, the password. This is the account you're going to. This is the statement you're going to download. This is how you file the statement. This is how you open QuickBooks. This is how you reconcile each of things. These are the common expenses that will need to be categorized. And it just went down. And then

And then I replicated that same bank rec for each of the banks that needed bank accounts that needed to be reconciled. So just picking one SOP to start with, it could be, you know, paying a utility bill, I think is good.

It can be so valuable just to start that repetition of building them out. So can I share real quick in the pro and what would Pete actually, you know, my old business partner, Pete, he was the, he was the integrator. I was the visionary, right? But my background being an airline pilot, obviously I'm very understanding of processes and checklists and our dumpster fire was handing over a new, when we get a new client or a new tenant, putting them in the property. For some reason, these people would get lost in this black hole that nobody knew for weeks that

We're like, what happened to this person? And next thing you know, this guy kind of comes up for air and he's like, you guys suck. And I've been knocking on the door for weeks or whatever. We had no idea. So I told Pete, I'm like, we got to we got to create a process and a checklist for this. So Pete says, OK, he goes, I'm going to I got it. I can do it. I'm like, you want me to do it? He's like, no, no, man, I got it. I'm the integrator. I'm like, all right, whatever.

So he spent like three weeks and he's like a mad scientist and he's doing, I'm like, I'm like, what are you doing, man? He's like, I got this. So he pulls out this process, right? It's a checklist and it's 19 pages long. And I'm like, what is this? He's like, that's the process. I'm like,

Sit down at your desk. Check. Turn on your computer. Check. Open browser. Check. I'm like, oh, I said, so Pete, let me explain something to you. I said, when I'm flying an airplane and we are going down the runway and if we have an engine fail right at rotation, which is the most critical time when you're flying a plane for anyone who's scared of flying, I'm sorry, but that is the most critical time.

When we have an engine fail, we have to take off. We have to secure the engine. We've got to dump fuel. We've got to go through all these processes. We've got to come back around and land. That's three pages. So we can take a plane, lose an engine, come around, land a plane in three pages. And you're telling me it's 19 pages to get this person onboarded. And he's like,

He goes, how long should it be? I go one page. It's so when people are writing these processes and checklists, it's what will kill you is what you identify. Now you can have an expanded version that's 19 pages, but that's when you say, Hey, what does it mean?

Load client into software. Like you check that off saying I loaded the client into the software. If you don't know what that means, then you go into the expanded version, which is the standard operating procedure, SOP as Ashley said, and that's where it's like two pages long explaining everything.

but you don't need that in the checklist. That's just loaded client, yes, I checked that off, that's acknowledged. That's something that I think people need to understand. You don't want it to be so detailed that you're just like, this is going to take me 15 minutes because what's going to happen is you're going to bypass things,

And it's the things that will kill you. Like I forgot to get the guy's bank account information. That would have been good to know, right? Showing the guy how to mail his rent. I don't need to tell him that, right? So those are the things you want to make sure you just put the critical things in the process procedures checklist.

That could kill you. So that just saying I you want to do this, but don't go too detailed because a lot of investors are C profiles in the disk, which are very detailed engineer types, most of them. And so a lot of that they will go to the nth degree with too much detail, too much information.

And that could stifle what you're trying to accomplish. Yeah. One, one follow up from you, Steve, we, we use a checklist pretty heavily in our business as well. And first, let me say for anyone that's thinking about doing a checklist, I would highly recommend the checklist manifesto. I don't recall who the, uh, who the author is, but he was like a doctor, I believe. Atul Gawande. There you go. Atul Gawande. Um, great book. Uh,

But I pulled up one of our checklists right now and it's for filling out our monthly reports that we have for our properties. And the checklist itself has eight steps. But next to each step, and it's very simple what the step says, right? It's like email slash Slack Tony that all the reports are completed.

But there are the steps there that we outline, but then there's a loom video that I recorded that goes into detail on each step. And each loom video is maybe 60 seconds to seven minutes, depending on the length of that step. But if they ever need to remember, okay, well, how do I actually do this again? They can go back and watch the loom. But once they've done it enough times, they can just knock through all the steps themselves. So

That's how we kind of combine our quote unquote SOPs with the checklist. Checklist is super high level. Then there's a video and supporting documentation for the details on that step.

I think between the three of us, we could go into very much detail on this. And so if you're watching on YouTube and you'd like us to bring Steve back, maybe sometime we can do an actual live webinar with Steve or something like that to actually go deep into building out these checklists and your SOPs. So comment below in the YouTube video if that's something you guys would be interested

them? You know, I've done it before where I've actually shown them the airline checklist and actually go in and show you how we run checklists with the airlines and how our SOPs are. And, you know, it starts putting things together because everyone's flown, but they don't know what, how do you guys handle things? So I've done that in webinars for people where I'm like, okay, let me show you what a checklist looks like flying a Boeing 777 and how we go through it. There's 1100 checklists on a 777.

So that's a lot of checklists, right? I don't need to know them. I just need to know where to find them. But like you said, Tony, somebody had to create them and make them simple that in the heat of battle, I can get to it. And I'm like, okay, page one of 19. What do I do? Page three. It's like, we don't have time for that. Like, dude, get to the heat of it. So yeah. Well, Steve, thank you so much for joining us today. Can you let everyone know where they can reach out to you and find out more information? Yeah.

You can go to my website, Steve Rosenberg.com. It's R O Z E N B E R G. You can find me on Instagram, you know, Rosenberg, Steve or Facebook or LinkedIn or YouTube, all the usual channels. But if anybody has a question, obviously they can reach out to me. I'm always available. I'm always here to help. I think that giving back is something that's important. And I think more people, you know, need to do these things to give back to newer people that, you know, they can learn things from, from our mistakes. Right. And that's, that's,

That's kind of how we all give back and we all get better. And I learn just as much when I go to events and I talk to people, something new that I don't know. So I think I would just encourage all of you when you are, you will be successful. And when you are successful, just give back, help out, be involved in bigger pockets, really try to be engaged because, you know, it's the law of reciprocity. The more you give, the more you will get back. And I'm a firm believer of that.

Yeah, and if you enjoyed today's episode with Steve and appreciate his time, he also has a great foundation, LiveLikeJet.org, that you can go to and check that out and maybe make a donation.

Well, Steve, thank you so much. Always great to have you on the podcast. We appreciate your time and all of the information, the mindset, the tactical stuff. So thank you so much. Thank you guys. I appreciate you. I'm Ashley and he's Tony. Thank you so much for joining us for this episode of Real Estate Rookie. And we'll see you guys next time.