Matt: Hey, everyone. Matt Ackerson, founder of AutoGrow.co, here. Today, I’m joined by my friend, Tiffany Jones. Tiffany is a startup entrepreneur. She just incorporated her first business. We went to school together at Cornell and Tiffany’s rocking the Cornell track today. So, yeah, we’ve been talking on and off about startups for years.
Tiffany knew me when I started my first business on campus. It was text message coupons for college students. So yeah, Tiffany, I’m really psyched to learn more about your business and talk about how we can help you market it.
Tiffany: Great. Thanks, Matt. I’m really excited to be talking to you about this. Like you mentioned before, I knew you at the beginning of your journey and you were really inspirational to me. And you’re one of the reasons why I’ve always been thinking about entrepreneurship and just trying to make the decision about when to finally make that jump.
Matt: Cool. I appreciate that, thank you. You flatter me. What’s the name of your company?
Tiffany: It’s called Demetrius Limited LLC.
Matt: And who’s that named after?
Tiffany: It’s named after my father.
Matt: Right. Awesome. And why are you starting this business? First of all, like what do you do now? Give us the full context since the audience wants to get to know you a little bit.
Tiffany: Right. So I am an attorney. I do mostly mergers and acquisitions. I work in big law. I work a lot of hours, and so I’m basically looking for ways to supplement my income and grow different opportunities.
Matt: Okay. So, while you’re practicing law you’re starting this business on the side, is that right?
Matt: Cool. And what’s this company going to do? What problem are you going solve for people or businesses, what’s it all about?
Tiffany: So basically, it’s a real estate investment company. What we will be doing is finding distressed sellers and helping them find solutions to selling their homes. What you will find is that there are some people out there who are in pre-foreclosure. They may have inherited a home that they don’t want anymore or they may be going through a divorce. These are people that need to offload their homes rather quickly. You don’t want to go through the normal measures of finding a real estate agent, and you also don’t want to pay those costs. So basically, I would be helping them sell their homes by finding buyers who are willing to purchase the homes, feed their flipping or keep them as investment properties.
Matt: Okay. Cool. So, Demetrius is basically going to be the matchmaker, the middleman between home sellers, people who may live in distressed properties, meaning that they can’t afford their mortgage, or they just want to sell their house for whatever reason. Maybe they’re going through a tough time, like you said, or they inherited something, they’re going through a divorce or any other reason. You want to match them up with buyers who want to buy the property, maybe for, at or under market value, and then make the house better perhaps, and then sell it back for a profit?
Tiffany: Right. So basically, you’re helping someone who already has very limited options, and you’re giving them cash quick. If this person was to go through normal procedures, they would normally have to wait a lot longer and have to pay a lot of upfront costs after they’re able to sell that property through a real estate agent. The benefit to the seller is that they’re not going to have to go through that process. Those processes could be long and drawn-out, just depending on what the market looks like, but it also gets cash in their hands fast. Then for the buyer, helping them find the properties that might be at full market value or might be lower than that.
Matt: Okay. So does the buyer normally buy it for cheaper than what it’s valued at? Because the seller just wants to get rid of the property or get rid of the house faster?
Tiffany: In these circumstances, the seller and the buyer aren’t going to be meeting. They’re not going to be interacting and talking about prices, so some buyers are very aware of what’s going on in the market. They’ve done a lot of research, they’re buying a ton of properties and so they’re only going to buy properties at set prices. There are other buyers who are just entering into the investment field. So for them, they may not necessarily be looking for under-market deals or basically have that same type of understanding of what’s in the market and how the market works.
Matt: Okay. But does the buyer set some advantage off the top because they’re offering cash in-hand upfront?
Tiffany: Yes. They would get the property quickly and the property would be cheaper than a property that was fully fixed up.
Matt: Right, right. Okay. Cool.. So let me make sure I got this right. For the buyer, you’re solving a problem for them because these are investors with money they want to put into houses to make the houses better and then sell back to other newer home buyers who are entering the market, or for whatever reason they want to buy a home. For sellers, you’re solving a problem for them because they just want to liquidate or get rid of this house they have and turn it into money in their pocket.
Matt: Okay. Cool. So where are you today with the business?
Tiffany: Basically, I’ve set up all the systems, and I’ve set up a website for both buyers and sellers. I’m at the point where I need to find customers, right? There’s different methods of acquiring a customer, and when you’re looking at sellers, a lot of them are one-time customers. Two of the methods that I’m choosing to focus on are my website and inbound leads. Having people who are looking to sell their home, and so basically, you’d look at keywords like “sell my house fast” within that specific city.
They’re looking for anybody who could help them sell their homes. Then the other method of finding sellers would be driving around neighborhoods looking for properties that are distressed and then basically, working backwards from there, looking up all the legal records, tax records, to see what’s going on with the property, getting the person’s information and then contacting them.
Matt: Okay. You want to contact them because you want to make sure they’re a qualified seller, in this case?
Tiffany: Well, they wouldn’t necessarily be a qualified seller per se, they would already own the property or have the mortgage that’s on the property. You’re contacting them to see whether or not they want to sell the property. In some cases, a property might look like it’s distressed. For example, that would look like having a lot of mail in the mailbox, or having really tall weeds in front of the house, right? So, some people might be in a position where they’re like, “yeah, I wanna sell the home.” Other people might be in a position where they don’t fully own the home. They’re upside down in their mortgage, so you can’t necessarily help them. A lot of that is just like going through the weeds and trying to figure out whether or not this is a good investment for you and whether or not they actually want to sell off their property.
Matt: Okay. So based on whatever buyers you have relationships with, or if you have a list in your database, you just match them up and say, “you know, here, mister or misses investor, we’ve found this property over here, it might match your criteria.”
Matt: Okay. And how do you make money? How does the business make money from this transaction?
Tiffany: So basically, I acquire the contract with the seller. You know, look at the property, offer them some amount.
Matt: When you say you acquire their contract, does that mean like you’re almost like a real estate agent but not, obviously?
Tiffany: In a way, yes, except that I’m an investor and I’m bringing in my investor partners. I am trying to sell the home, but I have a contract which allows for me to say that I own the property. I also have the ability to sell the property. A real estate investor would basically have a situation where they have a right to sell the property, but they have no interest in the property. The contract would provide me with that interest.
Matt: Okay. Cool.
Tiffany: And so I would have a contract with the seller and then I would be looking at my list of investors in deciding which ones I want to provide the opportunity to. Then I would also have a contract with them to sell that property, so I would have to make a decision about how much money I believe I should be making on that sale.
Matt: Okay. Let me go off on a tangent for a second. Why start this business? Why not continue on the path of being a lawyer and making good money doing that. Why do you want to start a business?
Tiffany: This is partially your fault, Matt. You know, when we were in college you were really gung-ho about the entrepreneurial path. And so, through the course of our friendship, which has been about, I don’t know, over 10 years, what I’ve seen is someone who is aggressively trying to fulfill their passion and build the life they want. So, you know, for me, I’m in the space where I’ve worked incredibly hard to get what I’ve gotten, but I still have limited power over my complete situation. You have more power than I do. Right now you’re in Colombia; you’re working remotely. I don’t have that type of ability. I have more of that ability than other people, but I don’t have it to the same extent that you have it. So, for me, it’s really a lifestyle control, but it’s also control of my destiny. You know, my employer could decide to fire me at any point in time, even if I do an incredibly good job, that’s still their decision, right? They still have that type of power over my life. And so I want to be in the position where I have more power over my life.
Matt: Definitely, definitely. Yeah, it’s truly one step at a time. I feel like each year has been a step forward and, you know, I can talk more about that. I think a lot of the viewers have been probably following the recent videos I’ve been putting out, and like each year is another step forward because for a while we were in the service business. Now, we’re going to be selling products. It’s kind of like what you’re going after, it’s kind of like the idea of the pursuit of happiness. Nothing’s ever perfect, you’re always going after it. This is another step forward this year, because by selling products, it’s similar to what you’re saying, it’s control over your lifestyle. This gives more control over my time at least, and that’s what I’m going after long-term. So I totally relate to that, I totally get it. Where are you at right now with your marketing? You said you’re looking for customers and you have the basic website set up, is that right?
Tiffany: Yes. So right now, I’m trying to work on the SEO of the content of my webpage. I am using a real estate-specific webpage provider. The great thing about that is they already provide me with content, but then I have to go in there and try to manipulate the content to fit what I want to represent my company. There’s also the SEO aspect of that, how I drive customers to the website. Right now, I’ve worked a bit on the content. I need to start working on linking up other websites and other options to my website. So that’s where I am as far as the online marketing is concerned.
Matt: Okay. And when you say linking up other options, are you referring to social media?
Matt: Okay. Do you have examples or do you know of case studies where your type of business has succeeded on social media?
Tiffany: No. I haven’t started digging into that from that perspective, but what I’ve seen online is like a lot of people who speak about the wholesaling business in general. I haven’t seen what it looks like as far as driving the actual business in that direction because when we’re talking about them, talking about the wholesale business, then that’s a whole other business, that’s not the actual core business of how they’re making sales. I mean, people are putting themselves in the position to actually teach the business to others. So I haven’t seen examples of that.
Matt: Okay. So you may or may not have heard the recent news, that Mark Zuckerberg came out and he said that he wants to put more of an emphasis with Facebook in people’s newsfeeds. He wants the stories to focus on friends and family, and I feel as though, you know, all businesses kind of looked at that and said, “well, I guess that’s pretty much it,” because this wasn’t really new so much as just the final nail in the coffin of the idea that you can be on Facebook and drive organic reach, because that’s really been declining for years at this point. For example, another Cornell graduate who was one of AutoGrow’s first clients back in the day when I first started the business when we were selling website services, spent over a million dollars acquiring two million fans on Facebook in the earlier days. Back then, the newsfeed looked completely different and looked much more similar to what you would see on a personal profile.
Now, today, if you go to any kind of business or brand page, it looks completely different. You can’t even find the newsfeed. That’s done on purpose because Facebook is basically now more of a pay-to-play network, if you will. As we wrote in a recent article on AutoGrow.co, it’s still useful to have a page on Facebook for what’s called social proof, which just means that you have a little bit of credibility. It’s really not so effective if you’re looking to get fans and then convert those fans into customers. A better strategy, if you were comparing options for, “okay, do I want to pay money to acquire leads” would be to look at Google, or you mentioned local SEO, that’s good. Let’s say you wanted to pay Google on a pay-per-click basis to have one of your ads at the top of Google search and you’re comparing that option to Facebook. I think one of the things that you want to know going into it is Facebook will be very competitive for your market, so you may be paying up to $15, depending on how targeted and how specific you are with the terms. For example, what do you think would be…what was one of the keywords you’re going after right now?
Tiffany: “Sell my house fast, St. Louis.”
Matt: Okay. Do you have any idea of what the pay-per-click range would be to bid on that, to place an ad for that?
Tiffany: I have not looked into that.
Tiffany: Because that’s one of the more popular keywords, I know that that’s going to be way more expensive.
Matt: Right. Right. Because there’s other competition already bidding on that keyword?
Matt: Or you would be surprised if you’d be paying in the range of $15 to $20 a click? I could be wrong about that. The advantage is that there’s intention behind that search, right? Now, compared to Facebook, the traffic that you can buy from there is cheaper and it may be in the end cheaper, too if you can drive those people on Facebook from the Facebook ad to a landing page and give them some reason to opt in. So, for example, we had a client. His name was John and he was doing reverse mortgages. He targeted people in a very specific area on Facebook. The cost per click was much, much cheaper, and he was able to get people to opt in for it. The problem is that the conversion rate is going to be significantly lower because people are on Facebook to just kind of tune out and, look at their friends’ pictures and whatever. So, you’ll have to spend, a good amount of time figuring out like what’s a good hook to get people onto your email list, or to drive them to contact you on the spot. Because maybe, it sounds like the people you’re looking for are not really a nurture type of situation. That means you’re not going to look to form a relationship with them and give them a lot of free content. The people you’re looking for are already in this situation, it sounds like.
Matt: And probably like, when they get in that situation, it’s not necessarily planned. You know, people don’t always see a divorce coming, or a death in the family, whatever, and they have the property, right? I think that’s probably something to keep in mind, that you’ll probably want them to take action right away and fill out a contact form.
Matt: So tell me more about the content you’re getting right now for your website. You said that the company you paid money to is giving you some content.
Tiffany: Right. So the content they have is real estate-specific. It’s the same content they’re giving everybody else. Basically, what it does is it breaks down the fact that this is significantly different than going through a real estate investor. So they will list out like, “if you’re in these situations, this is how we could help you.” I’m going in there and changing the content to lay it out in a way that I think is more reader-friendly. Then the website already has a lot of very basic language. There isn’t a lot of complex language in there, which is really good. So it’s more of a matter of just like, okay, you know, what keywords do I want to focus on? How do I want to incorporate those into the page? I know that I could play around a little bit with the pitches. I haven’t gotten there yet. I think I’m at the point where I’m done playing around with the content. Now it’s time to figure out what strategy I want to use to drive more traffic.
Matt: Do you need to be able to see the property, to see the house in-person before you would present it to your investors?
Matt: Okay. That’s why you want to focus…or do you need to focus on local? For example, if I had a friend, “hey, Tiffany. I know a friend in New York, she wants to get out of this property that she inherited.” Would that work? Or would you be like, “no.”
Tiffany: Well, so at this point in time, I wouldn’t. That’s the space that I want to move into, though.
Tiffany: I believe it’s more important to focus on locals so you get a really good understanding of what properties look like and what types of issues are going on with the properties. Then it’s how to negotiate through that process, but I think long-term, a virtual wholesaling makes a lot of sense and just opens up a large array of opportunities.
Matt: Okay. Correct me if I’m wrong, but I imagine that it’s easier to find and put them on a list or in a database somewhere, the investors that are on the buyer side. Then the more difficult side of the equation is finding the sellers who are a match and who you can acquire the contract for.
Tiffany: So the buyers are difficult to find out unless you know how to figure them out.
Tiffany: That’s really a matter of finding people in your community and basically having them help you through the process of figuring out how to build a buyer’s list. The sellers, they’re difficult, but I think it really depends on the model that you’re using. There are a lot of people who’ve been very, very successful with really narrowing their focus on their website, narrowing the search keywords, really narrowing down their pay-per-click for certain types of words. They found a lot of success with lower costs. The marketing strategy is outside of that, right? So, some people do direct mail. There’s also cold calling. That appears to be a more successful model, because you’re not just paying a ton of money for pieces of mail to go out. You’re actually trying to get this person on the phone, and you’re being pretty persistent in trying to get them on the phone.
It’s really about getting the ball rolling, and then after that, once you’re able to start automating that, then it makes it a lot easier. But, yes. I mean, you have to find the seller first, right? So that’s going to be the initial challenge. The question is, how are you going to go about doing that and how do you lower your cost with doing that?
Matt: Okay. Cool. Have you looked into email marketing at all yet?
Tiffany: Very, very briefly. I haven’t dug into that more in-depth.
Matt: The reason I say that is, like I was saying before, this isn’t the type of field where you find someone who’s a homeowner and then one day they want to sell and you’ve just kind of been nurturing them over time, although that’s possible. What is more likely, though, is that if you have a growing email list, you can build a referral engine through word-of-mouth and eventually, people just know people and things back up over time, like “oh, hey,Tiffany. You know, John over on Main Street is going through a rough time and he wants to sell the house. You know, just wanted to meet you. Here’s his contact info, tell him I sent you, I referred you.” Have you thought about that, anything along those lines?
Tiffany: I have not thought about the referral process or emails yet.
Matt: Can I tell you a little bit about how that might work?
Matt: So when I started AutoGrow, I worked very hard and I feel very lucky that we crossed six figures in the first 10 months of actually starting the company. It really blew my mind, but there was a lot of work involved in getting there. Actually, the majority of that revenue came as a result of email marketing. What I did was really fundamentally very basic. I started by sending a newsletter every quarter, and I started with just about 400 or 450 contacts, you know, people that I met up at Cornell, a lot of the alumni and whatnot. That’s where clients number two and three came from and beyond.
Basically, what I would do with the newsletter is, I would kind of like tell a little bit of my story. “Oh, hey, everyone, I’m starting this company. I’m really excited and this is why I’m doing it. This is the main idea behind it.” I remember I was talking about the core values that I wanted to build the company on.
You know, and I feel like for people like us, you and I are… I don’t know if you would agree with this, but I think you and I are slightly introverted. So it was a little uncomfortable at first putting myself out there. I think that if you were to do something similar where you send a newsletter once per month, and you kind of tell people a little bit about what’s going on with you instead of the business, but also make yourself a resource for information, perhaps along the lines of what’s going on locally in the community, that’s going to make people want to continually open the newsletter because human beings are naturally curious. They want to know what’s going on with you, they want to, compare themselves.
“Oh, where’s Tiffany at? Where am I at?” Other people just want to hear more about your story, and they maybe even want to hear about the local news that you have to bring them. That positions you at the top of their mind repeatedly so they remember the next time something comes up. If you do that, you’ll probably see over time that as the list grows, you’ll get a compounding number of referrals coming back from that.
Tiffany: That’s an interesting idea. I’m definitely going to mull that around a bit more and see how that could work.
Matt: Yup. That’s also the reason why you might see real estate agents, for example, they try to invest in building their own personal branding. They put their heads on, billboards, and I’m not saying you do that, but with all the signs for the houses you might have or be under contract with, that might be a good avenue to invest in. Just to give you some stats to back that up: according to the Direct Marketing Association (this is a very cliche stat at this point because I know that I’ve cited it in the blog post left and right for years), email is on average 10 times more effective than social media in terms of ROI. That’s just measuring clicks to dollars basically.
Also, two times more effective than SEO. The reason for this is that if someone has given you their email address, they’ve made a minor commitment to give you a little bit of their personal information. More than that, the engagement rate for something that’s coming into your email inbox is often quite high, much higher than compared to something you might see while scrolling through your Facebook on social media.
Matt: Yeah. If you’re looking for a tool to get you started, I think MailChimp is free and very user-friendly, and their templates are also pretty easy to manipulate and move around.
Tiffany: Okay. I’ll definitely think about that. Thank you.
Matt: Yeah. I think that local SEO as well, just investing in that is absolutely the way to go. I definitely encourage you to keep going with that. A question for you, when you said content, did they give you content like just for your homepage and your about page, and you could edit that? Or was it, also that they gave you content for the blog?
Tiffany: All of it.
Tiffany: There’s content for the blog, too.
Matt: Okay. Cool. Cool. Yeah, this person didn’t end up becoming a client, but in the past, I remember I consulted with a lawyer for a potential project. He had his law practice where he had a website, and he was paying a company and they gave him content. So he had content on his blog and it looked like a very complete website. The only problem was that he wasn’t getting any traffic from it. The reason for that was because when I actually searched for some of the sentences that were in the blog content, the exact same copy was on like a hundred other lawyers’ websites. That was really the problem, because Google wants fresh, original content. People can usually pick up on if it’s you or something cookie-cutter as well.
So if you were going to consider a regular blogging routine, you know, either monthly or weekly, what I would say is look up the term “newsjacking” from David Meerman Scott. He’s kind of like a Seth Godin if you’ve heard of him, but related to inbound marketing. He talks all about how you nurture and build a relationship through inbound methods. Anyway, David came up with this term called “newsjacking,” and he started a whole brand and company around it now. It’s really the concept of taking news stories and include them in the content that you create for your blog, for example.
This does a couple of things. Number one, it makes what you’re writing very relevant to whoever is reading it. Second of all, because you’re able to get them reading, you’re able to get your message through, which is, “oh, hey, by the way, if you know anyone, referrals are appreciated” or whatever the call to action might be within the blog post. The best way to think about content when you create it is, it’s basically like your vehicle. Every piece of content is a vehicle and an excuse for you to indirectly promote yourself. I mean, let’s be honest, you’re in business and it’s nice to create content but you’re also looking to find customers and make a profit. So it’s win-win.
Tiffany: Okay. I’ll definitely look that up.
Matt: Any questions that you have for me, Tiffany?
Tiffany: Yes. So what would your advice be for someone who’s just starting out as an entrepreneur?
Matt: I would say, a thousand-mile journey starts with a single step, just put one foot in front of the other and don’t be discouraged. Be adaptable, but don’t be discouraged when you face inevitable setbacks. Because they will come, and if it was easy, anyone would do it. I think for you, because I know that you’re a patient, meticulous person, right? I think those are really great qualities to have as an entrepreneur. I would say keep being patient and meticulous. Because those are going to serve you really well.
Tiffany: Great. Thanks. And then my other question is, when you’re starting out with trying to acquire customers, what do you think is the biggest thing to focus on?
Matt: It’s all a numbers game. You might know this expression, “The Law of Averages.” It basically means if you talk to 10 people, one or two are going to become customers, but you have to be okay with the fact that eight out of 10 or nine out of 10 will just tell you no, it’s not a fit for whatever reason. That doesn’t mean they will never be a fit or they can’t be a source of referrals for you as well. So there’s opportunity, and an opportunity to learn in every circumstance.
In terms of sales, I would say that when you’re looking to persuade someone, don’t actually try to do it. You should get to a place, eventually if not immediately, where you’re just being yourself and you’re just asking questions. You’re kind of letting them sell themselves, because that’s the best kind of sale. If people feel that you’re trying to persuade them of anything, usually, they naturally want to put their defenses up because no one wants to have someone else’s idea or decision in their head. We want to have free will as people, or at least we want to believe that we do.
I would say that you might want to check out a book related to sales. It’s a very kind of win-win approach that’s informed part of my perspective called “Three Steps to Yes,” it’s kind of focused on a questions-based approach. I found that at the end of selling our services, a kind of funny story. I remember my last year in high school. I just didn’t give a damn. I didn’t care about grades and somehow the grades just kind of went up. This was kind of a similar circumstance where I was selling our services and I was getting to the point where I was about to decide, “okay, we’re going to discontinue our services” or I wanted to find a way to get into the products business.
I would be getting on the phone with clients and it would almost feel just very easy to have these conversations and they would just be like, “okay, let’s do it.” I think it’s because I didn’t feel invested in getting them to say yes. I think that’s really important. That’s what the perspective of the Law of Averages can teach you as well. Because if you accept that most times people will just say no for whatever reason, people will say yes more often.
Tiffany: That makes sense.
Tiffany: I think those are the only questions I have for you.
Matt: Cool. All right. So let’s stop it there. Tiffany, I want to thank you. I really appreciate you coming on here and just being open to where you’re at and being vulnerable. I know that not everyone would do it and a lot of people out there think about starting a business. I just want to congratulate you on taking this first step. I think it takes courage. So congratulations, and I look forward to checking with you perhaps on a future interview.
Tiffany: Thanks, Matt.