Warm Inbound Leads, Quick Flips, and Scaling a Real Estate Business the Smart Way

Leah Johnson (00:00)

The most important thing you have to have is infrastructure to handle additional volume. You have to be thinking about what it’s going to take to go from 10 deals a year to 20 deals a year and from 20 to 40. It is a lot of work. It is rewarding work, but you have to be prepped for what.

those that volume shift is going to look like within your business. Most frequently, that’s going to look like additional headcount and you have to be ready and forecasting for that before you need it.

Dylan Silver (02:04)

Hey folks, welcome back to the show. Today’s guest, Leah Johnson, is a real estate investor based in the Twin Cities, the greater Minnesota area. She spent 18 years in the tech industry before transitioning into real estate, where she now enjoys the flexibility of owning her own business. She focuses on making strategic, intentional decisions that align with long-term goals for her business, family, and lifestyle. Leah, thanks for taking the time today.

Leah Johnson (02:30)

Thanks for having me. Thank you.

Dylan Silver (02:32)

Now, after 18 years in tech, what made you make the jump into real estate?

Leah Johnson (02:38)

I think real estate has always been my husband’s passion. It was always his goal industry was to be in real estate. So when he started the real estate business, it…

made sense at a certain point for me to come over and join him full time. It was an easy decision for me at the time to jump out of tech and into real estate because my husband was, I’ve worked with him before at a previous job. I knew what it would be like working with him directly in our own business. And I really wanted the opportunity to.

make decisions and choices and things like that for myself, you know, to work for myself instead of working for a big company.

Dylan Silver (03:23)

Now, in your business, are you focused on the single family space commercial? Which niche are you mostly involved?

Leah Johnson (03:31)

Yep, single family. We specialize in homes that are probably sub 450. We fix and flip for the most part. We do a little bit of wholesaling, but most of what we do is fix and flip.

Dylan Silver (03:45)

When you’re looking for deals, are you going direct to seller off market? Are you getting deals from wholesalers? What is your acquisition strategy?

Leah Johnson (03:55)

Yeah, so we have a really solid marketing strategy that is all warm inbound. We don’t do anything with cold calling or cold texting. All of our leads are warm inbound, and our marketing machine works really well for us. We’re very blessed in that we’ve found the right mix of channels that drives the type of volume that we want to have.

Dylan Silver (04:20)

Now

without giving away all of the gold here, but maybe a nugget, you mentioned, you know, your marketing machine, your marketing strategy on a granular level. What does that look like?

Leah Johnson (04:29)

It has been a lot of trial and error over the years. went out on our own. We were part of a franchise and then we went out on our own in 21.

experience of trying to find the right marketing channels at the right quantity, at the right dollar amount that would produce the results we wanted was a lot of trial and error over the years and a lot of like intuitive like, this isn’t really working. We’re not measuring the results we want and making tweaks and discovering what cause and effect were ⁓ for that type of thing. We dominantly advertise now on TV ⁓ that is our most of our marketing

Leads do come from television and we do do a lot of SEO We do some a little bit of Facebook a little bit of pay-per-click But yeah, it’s been trial and error over the years

Dylan Silver (06:06)

Now the TV advertising, think a lot of people may be curious about this. I’m curious about it. What made you get into the TV space?

Leah Johnson (06:14)

I have to say this, I was completely opposed to being on television. My husband went to an investor fuel event and he had been going to the quarterly events and he kept coming home and saying, you know, the TV guy is there. I think we should try TV. And I kept telling him, no, I did not want us on television. And eventually he.

came home from an investor fuel event and he was like, Hey, just so you know, I signed up for TB. We’re doing this now. So, it, have to say this, I was opposed, and I was wrong. TB has been our best marketing channel at this point, but I, it was definitely not something that I came to, in an excited manner. So.

Dylan Silver (06:57)

Now you mentioned also the freedom that you were looking for when you were making that transition. So pivoting back to there, when you were going from tech into then full-time real estate, what was some of the critical takeaways that you said, wow, now that I have all this time, I really have the flexibility to do what I want?

Leah Johnson (07:19)

So I have a young family, I have four kids. Going into working for myself, going into business with my husband and doing that full time has allowed me the flexibility that I needed to make time in my life for my family, for my young family and doing all of the things that I wanted to do to be a present parent. It is interesting, I was in…

Technology, I was in IT for quite a long time and it is interesting because there are lot of parallels between technology and real estate. One of the main ones being that both of them are tend to be male dominated industries. And so I feel like I fit in very well in real estate after having the experience of working in tech for as long as I did and in environments where it’s, you know, it’s kind of a bro fest sometimes.

Dylan Silver (08:14)

You said, I’ve

been here before. This is all too familiar. The Minnesota market that you’re in, do you have any even neighborhoods within the Twin Cities that you like to review deals at or that you are particularly bullish on?

Leah Johnson (08:16)

Yeah.

We buy all over the Twin Cities and we buy all over Minnesota as well. We have bought houses in all area codes in Minnesota. We really excel in the first time homebuyer or the next move up.

homebuyer price range. So wherever you can find a neighborhood that’s full of houses that are three bedroom, know, two bathroom, that’s really our bread and butter is remodeling those smaller houses. We have done houses that are in the six and seven hundred thousand dollar range. It’s not our bread and butter. We don’t specialize in that. ⁓ You know, we we pretty much stick with what we’re good at and what we can turn quickly. So.

Dylan Silver (09:11)

Now, I know for a lot of flippers over the last few years, it hasn’t necessarily been easy, especially with so much change happening. How have you navigated these last couple of years?

Leah Johnson (09:57)

I should knock on wood as I say this, we have been very blessed. We run our business from a very conservative perspective. We don’t reach for the stars necessarily when we’re doing ARBs on the houses that we, and we never have. We run from a very practical perspective. And so the last few years we have experienced some very big growth within our business.

And we have been very blessed. The market has been still strong in the Twin Cities. We’ve done good things with what we had to work with. We pivoted a little bit in 25. Business volume was similar, but the average profit per deal was a little bit lower than normal. But we still had a great year. I can’t say that I have advice for people that are experiencing trouble in markets that are not still

as strong as so twin cities are right now.

Dylan Silver (10:54)

Now,

from what I hear in talking with you, know, so much is driven by marketing. And I think a lot of what people were having difficulty with was, you you used to be able to even buy a deal wrong. And if the market was there, you could still exit successfully. Well, those same decisions were now not panning out so well over the last couple of years. With the marketing machine that you currently have, how do you decide

you know, which deals to take versus which deals to pass up on.

Leah Johnson (11:27)

Yeah, a lot of that has to do with how

where our capacity is with our construction crews. We have two full time construction crews that we work with, North crew and a South crew. And honestly, whether we decide to hold a deal versus wholesale a deal, it depends on where we’re at capacity wise with our team. We lean more towards big, heavy rehabs, big rehabs, getting wholesaled off. Because when you only are running two construction crews, if you keep one crew busy,

for six weeks or eight weeks on one project, that means you’re turning lower volume. And so we tend to get rid of projects that need a really big heavy lift and just keep the ones that are the quick flips, the ones that you can get in and out in two or three weeks and move on to the next project.

Dylan Silver (12:19)

Would you say that for folks that are managing crews, there’s one key takeaway that has been particularly helpful for you or is it not one thing? It’s everything when you’re managing multiple crews.

Leah Johnson (12:31)

I think.

You need, when you’re managing, the people managing your crews have to be big picture thinkers. You can’t have people that are getting too lost in the nitty gritty details because they’ll drive themselves crazy. When you’re managing workload for multiple crews, you have to be looking at the big picture. You have to be forecasting all the time to know how much longer this flip is going to take, what your capacity will be for the next one, how many flips you should buy. You know, there’s just so many different

little decisions that have to get made and you really do need people that are big picture thinkers in order to run that effect.

Dylan Silver (13:10)

Now, I know you mentioned deciding whether you’re going to hold this deal or wholesale the deal. On the Dispo side, when you’re looking for end buyers, it’s gotten somewhat trickier, but I’ve noticed that when folks have a really powerful brand like you do, that it’s easier to find those end buyers. I’ve even discussed with wholesalers on this show that they’ve had experiences where they sent a deal out

that someone else had already seen, right? They maybe had daisy chained this deal, but they said, well, I saw that deal previously, but now that you’re sending out, I’m another look at it. So in the Dispo game, what’s your approach to nurturing those relationships and then to allocating those deals with the end buyers?

Leah Johnson (13:58)

Yeah, so we have probably about half a dozen buyers that we work with a lot. And then we have a whole bunch of buyers that we only work with occasionally. Everything we do in our company is process based. And so we have developed a process for vetting and selling to new buyers, people that we haven’t necessarily worked with before. We have a video that we show them and we have a whole like

intake process that goes through the vetting process for our Dispo Guide and vet a new buyer so that all of the things that follow our process are followed every time on every sale that we make, on every wholesale deal.

Dylan Silver (14:40)

I

mean, those processes are critical because one of the most frustrating things is if you have a deal, right, and it’s dying on the vine, so to speak, and you can’t really figure out, well, where’s the bottleneck, right? And so if you have those processes dialed in, especially when you’re coming up against a time when your option period is coming up, let’s say, you can at least say, okay, well, this is what happened here, we’re priced too high, or hey, there’s just not enough buyers in this area where this property is. But without those processes,

it becomes difficult. Bonus question here for you, Leah. When investors are expanding their business, and maybe they’re going from five to 10 deals a year to 20 or more, and they’re trying to determine exactly where to put their time and attention in scaling that, what would be your feedback for them?

Leah Johnson (16:12)

The most important thing you have to have is infrastructure to handle additional volume. You have to be thinking about what it’s going to take to go from 10 deals a year to 20 deals a year and from 20 to 40. It is a lot of work. It is rewarding work, but you have to be prepped for what.

those that volume shift is going to look like within your business. Most frequently, that’s going to look like additional headcount and you have to be ready and forecasting for that before you need it.

You need people on board before you’re dying and underwater and drowning. You have to be forecasting for all of those things in advance. You have to have the vision to see what’s coming when you’re going to increase in volume like that.

Dylan Silver (16:59)

And I think what a lot of investors come up against is they are operating like a cowboy in many cases on the lower level that may be what made them successful, right? They’re just like, I’m just gonna go hit this door. know, hey, I’m just gonna hand write these mailers and get them out there. That works on some level, right? But then when you’re operating at economies of scale, well, it’s hard to be a cowboy in five different places at once.

Leah Johnson (17:22)

Yeah, and this is this is a part of our growth path was when we started out it was just my husband and then it was just my husband and I and when we started growing You get to a point where you can’t you can’t wear all the hats you just can’t do all the jobs at the same time and the best thing we did was start investing in our growth path for the future growth rather than

getting to a point where you just slam your head against the wall and you’re burned out, you know.

Dylan Silver (17:55)

100%, 100%. We are coming up on time here. Any new projects that you’re working on and then as well, what’s the best way for folks to reach out to your team?

Leah Johnson (18:04)

We are excited to be buying a church. That is the next purchase. We’re purchasing it next week. We have purchase agreement that’s going to close next week on a church. I’m not sure what we’re going to do with it yet, but it’s just kind of an interesting project to be involved in. Yeah, I’m just looking forward to what summer market looks like.

Dylan Silver (18:25)

Thank you so much for your time today. Thanks for joining us on the show.

Leah Johnson (18:28)

Yeah, thank you.