In this episode, David Dodge together with Haim Mamane the Virtual Wholesaler Guy talks about the process of virtual wholesaling.
Haim Mamane began to buy rentals in California in 2011. He subsequently noticed that rentals are not his business, so he bought state property and focused on state markets. When he saw how profitable himself in the state out of the market, he took part in seminars and was surrounded by specialists who were much superior to him.
David: Alright we are back! Welcome back to the Discount Property Investor podcast. My name is David Dodge, I am your host. My co-host Mike is out on an appointment today. I have a special guest. I have been following this individual on social media. We have chatted several times online but I have not had the chance to interview him yet until today. So I am super excited to have him. I am going to screw his name up but I am going to try my best. Haim Mamane.
Haim: You got it!
David: Did I say it right? Oh right! That's what's up! My man Haim! The Virtual Wholesaler guy. I have been tracking Haim since I got in this business full time, so it has probably been about five years I would say since I started seeing him online. After a year or two we started chatting back and forth. Now it's like everything I see you do I'm like, man that's awesome, you're killing it in the game, keep it up, it's great!. So I'm like one of your biggest fans, my man.
Haim: Thank you.
David: I'm happy to have you on the show and I am grateful for you. How are you today?
Haim: Very good, I'm excited to here. Also been following you and your partner a lot. i love the monopoly cards you have in your office.
David I love it.
Haim: I'm excited to be here and share some nuggets with your audience.
David: Hell yeah! So Haim, so many things I want to discuss with you. You are the Virtual Wholesaler Guy, that is basically what I have known you as since I started following you. You have built a cool brand out of that. However, before we jumped on, this is a no holds barred type of a podcast. Before we jumped on, you were saying that you transitioned. I want to talk about that on the show.
David: You know lately when I've been seeing your posts, you are doing some really awesome fix and flips. It looks-- it's fun to follow you and watch you, because you are in your projects and you see the transformation from week to week. It's just really cool. Let's talk about A, the Virtual Wholesaler Guy, and B, the new and improved Haim 2.0, how you have kind of pivoted.
Haim: Listen, it's great because it is very-- applicable to where we are today, right? I think the game of this business is adjust and pivot. Adjust and pivot. I have been adjusting and pivoting throughout my-- long real estate career. It depends on your goal and what you want to do. So yes, I was a 9-5 employee, what got me out of the 9-5 job is doing virtual wholesaling deals in Memphis Tennessee in auto markets. But I build--.
David: Hold on real quick, you live in San Francisco now?
Haim: Yes, I'm in San Francisco California right now.
David: And you've been there since you started, right?
Haim: Yes, yes.
David: So you've always lived there, but you have only recently decided it sounds like, to kind of do some investing there, as-- prior when I first started following you, and was introduced to you, you were all virtual. I just want to make sure I'm on the same timeline.
Haim: Correct, correct. Maybe just a short overview of my journey. I was a 9-5 employee, hated it, wanted to get out of the 9-5 job. Start to re-listening to podcasts, buying $97 courses, and just starting to take actions. Started to buy rentals actually while working a 9-5 job. After buying five rentals I did a calculation, and it said I need 30 more before I can quit this job that I have.
David: I know right.
Haim: First pivot that I did, buying rentals based on my current goal that back then was to quit my 9-5 job, was not the right strategy. That was the first adjust and pivot mode, which was to start doing virtual wholesaling. I need to get some checks so I can replace my 9-5 jobs, so I can quit my job. So that's what I started to do. Just wholesaling while having a 9-5 job as the hustle side gig. Doing one deal per month, getting $5000 checks, $4000 checks, $10'000 checks until I was doing consistently two deals a month. I was making more on my side gig more than my 9-5 job. This was when I decided to quit my 9-5 job and go all in. I build--.
David: How long ago was that?
Haim: This was-- my Independence day, September 30th 2015. We--.
David: I love that you got the day, man. That's the coolest thing ever.
Haim: We celebrate here, my family, it's a big deal, it's my Independence day. This is when daddy is home all the time. That's where we can travel all the time, because that's what life is all about for me at least, it is the lifestyle business.
David: I love seeing your posts all over the world, in different cool places with your family. Your message is my favorite; it stands true, I love to travel too. When I see you guys out in different places, I don't have a jealous bone in my body, it's a grateful feeling for you, that you get to do those things. I'm like, man that's great. I love it.
Haim: Thank you.
David: Keep doing it. Keep those posts coming, man. I love it.
Haim: Thank you, thank you. Again, that's my 'why'. I want to travel. My guiding principle is make more, work less, so you can play more. So that's kind of-- I build-- I quit my 9-5 job, I went all in. I start to hire acquisition people. I had a lead manager, [00:06:16.14 - inaudible]. Seven people doing five to seven deals a month-- follow the traction model. I did a Monday morning traction KPI, I was traveling with my family in Greece, it was 3am in the morning and I am just dealing with bullshit. Hiring, firing, motivating, people dropping the ball. I found myself saying, I am in Greece, and I hate what I do. I am not present with my family. I am traveling the best place, probably one of the top best places in the world, and I am jet lagged, I am not present, I am on my phone. I'm just an unhappy person. That was another adjust and pivot mode moment. I need to do less deals with the bigger profit margins, this is when the decision was made in the end of 2017-- that I built and I need to shift to a model that is low volume and big spread. I can do it in my own back yard in San Francisco California. Since the beginning of 2018, I am doing-- again, six to seven deals a year, but each deal with big profit margins. This is what you see on social media recently when I kind of take people through a transformation. A property in San Francisco, how we are turning an ugly house into a beautiful house. But again, there is a lot of profit margin in these deals, at least up to four weeks ago. So that is kind of my journey. I think this is another adjust and pivot moment. I may go back to doing virtual deals if this situation continues, because it is all about adapting to a new reality. I think we are in a new reality.
David: Man, I totally agree. I love that you are open minded to the fact that we have to pivot. You called it. That's awesome. The market is going to change and we have to change with the market to be able make profits and do deals. I think that is the coolest thing every. So let's back up. Whenever you were doing your virtual, were you just in one or two markets? How did you find those markets? How long were you doing deals in those markets?
Haim: So I was going to cash flow markets. My main market was Memphis Tennessee. Then I was a little bit in New Orleans Louisiana, Little Rock Arkansas. That was the main markets because-- I don't want to say easier, it's not as hard to find a deal in cash flow markets than here in the Bay area, San Francisco. The median price is 1.7 million dollar.
Haim: The median cash for--. So I am not saying there no motivated sellers here, because there are motivated sellers in every market. But when you are sitting on a million dollar property, the type of motivation you have is different than somebody that owns a $30'000 rental in Memphis Tennessee or St Louis, or Kansas City. Also if you start to do marketing the marketing dollars go further in this type of markets compared to San Francisco, or Miami, or LA when-- again, I was just mailing and I got nothing. I was sending three thousand mailers and I got maybe three leads, out of three leads the people who want over retail because-- they knew they were sitting on a lot of equity.
David: Not interested in parting with it. Hell yeah. Totally makes sense. Let's talk about the process of virtual wholesaling. How long did you do it on your own before you hire a team? Or did you hire a team right away? What did that team look like?
Haim: No, from 2013-2015 I was doing it on my own while working a 9-5 job. Doing a deal of two per month. Back in 2013 most of my deals came from the MLS. I developed a system with virtual assistants that just blasted offers, like 200 offers per week. It was a numbers game. Every 200 offers got a deal accepted. So this was back then. Now you can find these on the MLS as well, but probably in the marginal markets, not in the big cities. Like in the secondary markets I think there is still deals to be made off of the MLS. This was back then, just a team of-- I had two virtual assistants. They were just blasting offers on the MLS properties.
David: Very cool, very cool. So did you ever transition into off market properties?
Haim: Yes, so then again I had some money to reinvest into payed marketing channels. So I developed a Driving for Dollars system when I had multiple drivers. Each city Driving for Dollars and building a list.
David: Cool, that's awesome, I love it.
Haim: Again it was cool because you can still build a system of drivers that are generating Driving for Dollar leads in virtual markets. I am sure that you know that the best leads-- at least for me to perform better, it's always been the Driving for Dollars leads. That's-- that was my focus initially. Then I was started to buy leads, like most other wholesalers and investors do. The high equity, the divorce leads, the inheritance leads, the eviction leads. All these leads and started to mail. I was always a big proponent of people calling me. Not be the one that initiates the call. Pull marketing as opposed to push marketing. The quality of the leads is better in my opinion. Somebody calls you, you have a much better negotiation position.
David: Absolutely. Yeah.
Haim: That's what I was doing. I think mailers and Driving for Dollars was my main source of leads, and also realtors that I closed to in the past, got both sides of the commission. So I was the best buyer ever so they kept bringing me off market listings when they had pocket listings, so I was able to keep generating referral leads and close more deals.
David: It's awesome how that works. You start doing some business with some people, then all of a sudden they start giving you more business, right?
Haim: Especially if you make their job easier, and they make you more money, going the traditional way which is kind of what helping me getting deals in this super competitive market with realtors. Right now I am doing seven deals a year. I don't need a big marketing machine to generate leads. I am working with realtors and I am buying from wholesalers, that's my two main lead generation-- today in San Francisco-- and it's always about how they can make money with me, and how I can make their job easier.
David: Man, I absolutely love it. So what was the transition you took? Or why did you go from one market to-- it sounded like three or four? Was it just that you weren't having enough luck in one of those markets? Or did you always have the goal just to hit multiple markets when you were doing it virtual?
Haim: No, no. It was me trying to compare myself to others. Trying to do what other people in my masterminds are doing. I was just following the wrong track. I thought that scaling, everyone loved the word scaling right now, right? How to scale, how to do more. It was against my goals, my DNA. I wanted to make more by working less. But when you scale, I think there are more pieces to the puzzle. Again, you need to manage, you need to train, you need to fire, you need to motivate, you need to track. Just more moving pieces. I build-- again, a machine that-- did not make me happy. I did it because other people around me, that's what equates success. Only when I decided to follow my own track, follow my own journey. I had to shift and shut down the scaling mode, and do more by working less deals, but each deal has to be a much bigger deal.
David: Haim, I love it! So that's the motto, make more, work less, so you can play more, right?
Haim: That's my guiding principle.
David: Man, that's awesome! So there are so many gold nuggets and lessons here, guys. You don't necessarily have to scale to be more successful. How do you define success first and foremost?
David: Second, every deal is going to have a value, so I love the approach of, hey let's go for the best deals, the good ones. Then we don't have to chase all these people around for these shitty or okay ones, let's just look for the good ones. It will allow us to work less, travel more, so we can essentially more to do all that. I love it, man. Very, very cool. Let's talk about the team today. Do you have anybody on the team, or is it just Haim?
Haim: There is me and a partner, that's it.
David: You and a partner, okay.
Haim: Me and a partner, he is a strategic partner. When I started I was doing it alone, like fix and flip in the Bay area alone for a year. But then again, I was managing the contractor. I was just going every week, almost every day I had to go to the site to make sure everything is done. I have to write checks, I have to-- and I realized that A, I don't like to do it. B, it is not my strong suit, not my best--.
David: Right person, right seat.
Haim: I'm a hunter, I like the deals, I like to structure, I like to negotiate. I like to be out there and meet with realtors. I don't like to put together a scope of work. I don't like to work with contractors and manage progress, and cut checks. My partner completes me perfectly, he's an architect. He's a detail orientated guy. So he manages the crews. He knows how to pull permits. He knows how to run a budget with contractors. He knows how to manage contractors, he does a much better job than I do. The key terms here, big nuggets--.
David: You are cutting out on that last part, say that last part again, you cut out on me. Go back about ten seconds.
Haim: The return on time is super important. Not the return on investment.
David: Yeah. I agree. I 100% agree.
Haim: Time is huge when you have the right partner. You can do more and you can do a better job by having the right partner.
David: I totally agree. That's cool, man. You keep it simple.
David: How many was your team? That's now. Let's talk about when you were in multiple markets. It sounds to me like-- you woke up and had an epiphany at some point and were just like, man, why am I doing all this? I am probably really stressed out. Yeah I might have a big gross number, but my net number is-- I am just making assumptions here, but that's how most people get to that point.
David: I'm scaling back my own business at this point just because of that. Yeah making 50k a month every month is awesome, but if your expenses are 48, your take home is two.
David: Right? It matters. The gross numbers and the net numbers are what's important when you are comparing them. The net is really what matters.
David: So you got one other guys, it's Haim plus one now.
David: But before, you had to have had a team of people, and army of people, right?
Haim: Right. So I had an acquisition guy in each market. So I have a guy in Memphis, I had a guy in Little Rock, and I had a guy in New Orleans. I had three acquisition guys, and I had a lead manager that took all the incoming calls. She was assigning the-- scheduling the appointments to each acquisition guy on the ground.
David: Okay, so one lead manager for all three markets, then an acquisition guy on the ground, so that's four, okay.
Haim: Correct. I had two virtual assistants in the Philippines. Two [00:20:48.09 - inaudible] lead generation and repeated tasks--.
David: Follow up, yep. Out bound calling, all that stuff.
Haim: The detail task and I had a disposition guy that kind of-- disposing and settling the deals. So that is my team and myself.
David: Seven plus you, so that's eight.
David: Eight, nine.
Haim: I think it was seven.
David: Seven plus you, that's eight. Wow, man. That's-- crazy, right? Isn't that nuts? You went from eight to two.
Haim: Yes. Two is a partner, he is not an employee.
David: A different mindset there too, man. I think that's awesome, Haim. Very very cool, very cool. What are you working on right this second, man? What's on the table?
Haim: Right now we have a project that we are finishing up. We plan to bring it on the market in the next two weeks or so. We don't know how this situation will impact our exit price. We hope that it is not going to impact us too badly. But right now-- I'm planning a big move personally. I may go back to Israel to live with my family. Family is my number one. My parents and my extended family, my wife's family, they are all is Israel. We want to be with them, we miss them.
David: Totally, I think that's great.
Haim: Twenty years it's been that I have been here. It will be another adjust and pivot mode. I may go back to doing virtual deals in virtual markets. I think one big piece that we didn't touch on that I think you will appreciate is the passive side of the business, right? Everything-- all the profit that I make in wholesaling or the big flips that I do. I push to acquire assets that generate income. So it's either buying rentals in markets like St Louis, Kansas City, Memphis. And doing a lot of private money loans to experienced investors in this market. Actually one of my biggest borrower lives in St Louis in Kansas City.
Haim: That is kind of what's helped me. Again, get the profit and just park it to put it to work by buying assets that generate income. Whether it's private money loans or rentals.
David: Very cool. Very very cool. I absolutely love that. You know-- I'm very comparable. In my business, my focus isn't on more income, it's on more wealth. That's really the name of the game. Like I love wholesaling, I love landlording, and I love fix and flip. I have a free course on wholesaling. I wrote a book with my partner Mike on wholesaling. But to us, wholesaling is a job and we are fully aware of that. Now we love it. I even like going on appointments and walking through houses and negotiating face to face. That is actually one of my favorite things about wholesaling. I get a rush from doing that. I don't know why but I just like doing it. I hate sitting being at home or in an office. Being on the road, to me that's cool, right? It's a job, right?
David: It's a means to an end.
David: So what we do is just market direct to motivated sellers so we can find our own rental properties and our own fix and flips. Right now we are on our 65th rental online this morning. I am not sure if you saw my Instagram a couple of hours ago. We got our 64th online. We typically have 5 to 10, maybe 12 flips going, or rehabs going. Some of those are rental rehabs, but some are fix and flips. We wholesale anywhere on a bad month to five, on a great month twelve to fourteen. But it is always keep the best, right? That is always the mindset. Every appointment I go on, or my team goes on, it is for me and my team to buy, not to wholesale. It is keep the best, sell the rest. So I encourage everybody to start real estate investing via wholesale. You don't need a ton of money, and the lessons you can learn from it will carry through ten fold on these other types of investing that you do with landlording or fix and flips, and so on. I think you will agree with me in that.
Haim: Yep. Wholesaling is the foundation. That is the foundation to any way you are going to continue to go with this business. You have to find a deal and generating the lead, you have to close the deal and know how to negotiate.
David: Absolutely. You know, even on rehabs when people over rehab, I've done it ten times, right? Go over your budget.
David: I've had projects where I've doubled it on six figure projects. But at the end of the day, you only loose if you bought it for too much. That is all that matters. You make your money when you buy, you get payed when you sell. That is the Discount Property Investor slogan.
David: Make your money when you buy, get payed when you sell. I am going to say it again. But you make it on the buy. That is where wholesaling comes in. It teaches you to make offers at 30, 40, 50 cents on the dollar sometimes. The coolest thing is, when I make an offer at 30, 40 cents on the dollar, it's because I don't even want it, literally. Like if they say, yes, it is almost going to be a pain in the butt to go do it. But sometimes those deals are the ones you can make the 30 or 40 grand. It's like, wow how did they even accept that offer? It is really truly amazing. I think it's amazing. Haim, thank you for coming on the show.
David: I absolutely love it. Haim's motto guys, make more, work less, so you can play more. If you are not aware of Haim, go follow him right now on social media. I love following him. Haim, what is the handles for Instagram, Facebook? How does somebody find you.
Haim: On Facebook, it's The Virtual Wholesaler Guy. That is the best place to find me.
David: The Virtual Wholesaler Guy.
Haim: Yeah, on Instagram I think it's @HaimPalman. I can send it so you can share.
David: Let's spell it out. H.A.I.M.E?
Haim: It's H.A.I.M. Another P.A.L.M.A.N.
David: Check Haim out, I love seeing his posts. He is all about living that lifestyle, right? it's what everybody desires, everybody that gets into real estate because they want freedom. This is the truth, right? This is why I got into real estate because I wanted freedom. What you soon find is that you have zero freedom, because you are always trying to scale and do more. It's not necessarily about making more, right? Typically it is, but it is not always. Haim has figured out that you don't have to do more. Sometimes you can do less. You can truly achieve the freedom that most people are seeking. Haim, my hat is off to you, brother. Thank you for coming on the show. I am grateful for your time. As always, it is a pleasure to talk and chat with you my man.
Haim: Thank you my man, thanks for having me. It was a pleasure and I am sure we will stay in touch.
David: You've got it. Guys, until next time, I appreciate you listening. Go check out Haim on social. I will catch you the next episode.