Nobody wants to fail in business, and that includes real estate investors. But growing your real estate business isn’t a paint-by-numbers process, and it’s important to know there you will experience challenges — and failure — in your quest to reach your real estate investing goals.
The key is to realize not all failure is bad. In fact, failure can be a very positive (and ultimately profitable) experience. As long as you see failure for what it is: feedback you can use to improve your skills and make you a better real estate entrepreneur.
So, while not reaching our investing goals is not something to strive for, here are three ways failure can serve as a foundation for growing your real estate business and your abilities as an entrepreneur.
Growing Your Real Estate Business The Right Way
1. Use Failure to Take the Temperature of the Business
When things go well — the real estate deals are flowing and you’re scaling your real estate business — it can be easy to get complacent and overconfident. Coincidently, that’s not the case when deals run dry, and every lead heads straight into a dead end.
Instead of beating yourself up because things aren’t going right, do a full inventory of your business, piece-by-piece, and make sure you have the plans and systems in place needed to succeed.
This means doing a post-mortem on four key areas of your business:
- Business plan: Is your business plan realistic? Is it specific and concrete or vague and wishy-washy? Does it take into account current market factors? Do you have a business plan at all?
- Marketing plan: Is your marketing plan based on data and research or on results you’d like to achieve? Is it focused on a specific niche of the market or is it general and broad? Marketing works best when focused and narrow.
- Financial plan: Does your business “make sense” from a financial standpoint? Do you have the the resources — both financial and physical — to execute this business properly? If not, how can you acquire additional capital for marketing, systemization and continuing education?
- Mission statement: Do you have a clear reason “why” your business exists (aside from making money)? Is there something driving you to create a real estate business? (Helping others, improving neighborhoods, getting out of the 9-5 rat race, etc.)
For many first-time entrepreneurs, it’s not a lack of ability that gets in their way, but a lack of vision — they simply can’t “see” the path to real estate investing success. But by working on your business, marketing, and financial plans — along with your mission statement — you’ll articulate what you want your business to look like. And how exactly you’ll get it there.
2. Use Failure to Find Your Blind Spot
All entrepreneurs, even the highly-successful ones, have a blind spot; an area of their working life in which they are actually sabotaging their success.
Perhaps for you it’s a lack of good time management skills. Or maybe a lack of marketing savvy. Or a brusque manner which turns off others in the midst of a negation.
Unfortunately it’s called a “blind spot” for a reason; they are hard to find, and most of us act unconsciously without realizing we’re getting in the way of our own success. Fortunately with a bit of effort — and some detective skills — we can shed light on those less-profitable quirks of our personality.
Though there are many areas of your entrepreneurial skill set you could focus on to expand your real estate business, here are three common stumbling blocks investors face:
- Time Management: Over the next few weeks, track how you spend your time, both working and “off the clock.” Are you spending chunks of focused time on one task or are you jumping from idea to idea? Are you planning to work on your real estate business more than you actually “work” on your real estate business? Use a time-tracking app or pen-and-paper to give you vital intel on how you spend an average day.
- Priority Management: In addition to time, you want to track what you spend time on. Are you spending a majority of your time on critical tasks that bring the highest return on investment (ROI)? Or are you spending most of your time on less-impactful items?
- Personal Assessment: Real estate investing is a vocation that requires stellar communication skills. But sometimes we aren’t communicating the precise message we want people to receive. Reach out to somebody who knows you well — a friend or former colleague works — and ask them to give you an honest assessment of your interpersonal skills. Do you come off as personable and charming? Or impatient and self-serving? This may be difficult, but it’s vital to know what message you’re sending, so you can ensure you get the business result you want.
3. Use Failure to Look at Obstacles Differently
There’s a reason why Ryan Holiday and his book “The Obstacle is the Way: The Timeless Art of Turning Trials Into Triumph” is a favorite of entrepreneurial experts Tony Robbins and Tim Ferris, along with nearly every head football coach in the NFL.
His message of seeing the “obstacle as the way out of the obstacle” is a powerful methodology that can instantly change every aspect of our lives.
Borrowing from the ancient Greek philosophy of Stoicism, Holiday lays out “how the struggle against an obstacle inevitably propels the fighter to a new level of functioning. The obstacle’s the advantage, not adversity.”
- Could your lack of industry contacts help you in building a successful real estate team in creative ways your competition won’t think of? Yes.
- Could your lack of a huge marketing budget motivate you to track every penny you spend and make you a more effective entrepreneur? Yes.
- Could business failures you’ve faced make you more compassionate for home sellers having a tough time paying the bills? Absolutely!
By shifting your perspective of failure from obstacle to opportunity, you’ll not only reduce stress levels, but inspire your brain to come up with creative solutions to expand your real estate business.
What is Failure, Anyway?
Information. Failure is information. About what worked, didn’t work, and what you can do to make sure you get your business trajectory back on track and pointed in the right direction.
The only real failure is not to try. To not do your best to continue growing your real estate business. Because if you continue to gather information and make adjustments — both internal and external — you might just find your initial difficulty as a real estate investor was exactly what you needed all along to succeed.