7 Things To Do When Hiring New Team Memb...

Hey guys – with this lesson, we’re excited to bring to you the kickoff for our newest series. We’re calling it the “7 Things” Series. In this series, we’ll hand off a subject to one of our advisors and then ask them to come up with 7 important things that they’d like to share about that topic.

You’ll be seeing a lot more of these types of lessons coming out in the near future. Each advisor will have their own spin on this theme. And who better to feature in this kickoff lesson than our own veteran, long-standing contributing advisor, Patrick Riddle.

Kick it Off, Patrick

This is Patrick here, and I’m super excited about being the first one out of the gate to kick off the new “7 Things” Series. I’m also excited that I get to address a subject that fits in the business-building arena.

I’m a firm believer that business building is every bit as important as learning real estate investment strategies.

Building a business, and putting together real estate deals, are two entirely different things – both of which require two entirely different skill sets. Both are equally important in your success.

In this lesson I share the steps that I take when hiring new team members. These are the 7 steps that I take, and also are the steps I recommend to other people. This is good timing because I recently hired my newest team member, Pamela. I can use her as a great example which will give you even more insight.

1) Clarify the Position

When you first consider hiring another person for your team, the first thing you need to do is clarify the position. Make sure you’re clear on exactly what you want that employee to do for you.

Oftentimes, I even write it out just to clarify in my own mind: “I want to bring on someone to do X, and have this position with these responsibilities, and this person will handle these specific tasks."

From there I create that list of the responsibilities that I want to hand off.

2) Seek Referrals

The next step is to seek referrals. In my experience, I’ve found that referrals are the best sources for finding team members. This can happen in the course of my daily conversations… and as we’re chatting about a few things, I’ll say: “Oh, and also, I'm hiring someone in my investment business. So, I'm pretty excited about that."

Just by casually tossing out that bit of info, I end up getting referrals.

In my most recent hire, I got three referrals from local friends and associates. One of those referrals was a woman named Pamela. This came from a good friend of mine because Pamela used to work for his business, which is a similar type of real estate investing business. Additionally, she has a background working with different real estate brokerages, and she used to be a Realtor. It seemed like the perfect fit.

3) Go to Craigslist

If I haven't gotten a good fit from referrals, then I turn to Craigslist.

When I post on Craigslist for a new team member, I make the interested person follow a few specific steps in a process. For instance – I ask the person to send an email to a specific email address containing their resume. I then ask them to answer three questions.

Why do I do this? Because I’ve discovered that many times people don't follow these simple steps. This means I can immediately disqualify them. Typically only 20% to 30% of people actually follow the steps that are outlined.

What an easy, quick way to whittle down the list of applicants. Once you have a smaller list, you can ask them to fill out a longer questionnaire and gain all kinds of information.

Ask them to take these steps before you ever even talk to anybody on the phone. This will help you to disqualify the majority of applicants who would otherwise just waste your time.

4) A Get to Know You Call

By this point, I have a list of potential candidates – now it’s time to set up what I call a Get to Know You call. Just by chatting with the person on the phone, I can get a pretty good idea as to whether or not they might be a good fit.

This is not a structured call. I usually start off by saying something like: "Tell me a little bit about yourself. What do you like to do?"

I don't just talk business. I try to make this informal and put them at ease. I’m using this call to feel out this person. I usually let them know just a little about the specific business model that we have and a rough idea for the position that I'm looking to fill.

5) A Talk About the Details Meeting

For the person/people who passes the Get to Know You call, I set up a Talk About the Details meeting. There, I'll go through all the further details and clarify exactly what the position is and the idea for how we would get started if things worked out.

6) Make Them a Job Offer

I can usually tell from the details in these conversations which of these candidates I want to go with. As you can see, I’ve factored in a number of hoops for the applicants to jump through. I’m now ready to make them a job offer. But I’m still not quite ready for a long-term commitment.

7) Start with a Short Trial Period

I will now set up a trial period that will cover a short time – maybe 30, 60, or 90 days. (You can do what works best for you.)

With Pamela, I set up a 60-day trial period. This is how I explained the situation to her:

“This trial period is for me to find out whether or not I feel you're a good fit for this position. But, it's also a chance for you to find out whether or not this is something that you feel you would enjoy doing.”

The idea of a test period makes it more comfortable for everyone. That way if things don’t work out, both of us will feel free to easily back out.

So even after you’ve discussed all the specifics of the responsibilities involved, I still strongly suggest setting up a short test period.

How to Setup Job Responsibilities and Compensation

Some of you may be wondering exactly how we set up the job responsibilities and compensation. Here are the details...

In the beginning, we're going to focus on one small part of Pamela’s overall role. Later, her role will grow and expand, but I choose to start small and work up. The first area is lead harvesting and list segmenting.

A. Lead harvesting & List Segmenting

We do a lot of direct mail in our business, so her position will be harvesting the different leads that we target through direct mail, segmenting our list and coordinating with our direct mail company to get those off the ground.

B. Managing Contact to Appointment

The second part involves the contact to appointment, which consists of handling all the incoming calls from sellers. She will be:

Qualifying those leads;
Doing preliminary due diligence; and
Setting up appointments for my partner to go and negotiate if the deal makes sense.

It is in this second area where we're going to initially focus all her efforts until she becomes proficient in this one task.

C. Transactional Management Contract to Close

description The third part of her overall position will be to help with the coordination and organization from contract to close. She will take care of all the details from when we get a contract on a property all the way through to taking it to the closing table.

Pay Structure

There’re a couple different ways that you can structure compensation. For this trial period with Pamela, we're paying her a base amount plus commission on the properties that we flip. The base rate is $250 per week; plus a small percentage commission from the deals that we flip and close.

Put it All Together

There you have it. If you’re still trying to run your investing business as a soloprenuer, I strongly advise you to stop. There are some fears that you may have to break through in order to take that step. But I say, take that step anyway. When you do, it’ll allow you more time to focus on what you’re best at doing – and that’s finding deals and bringing in the money.