Episode 29: Our Craziest Deal Stories

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Episode 29: Our Craziest Deal Stories

In this episode, hosts Justin Piche and Clay Hepler dive into the fundamentals of land market selection, sharing their strategies and insights on how to choose the right markets for investment. They discuss the importance of understanding market dynamics and the factors that influence successful land deals.

Key Highlights

Personal Updates:
Clay kicks off the episode by sharing his recent Smashcake party, where he hosted 26 guests, and reflects on the fun of family gatherings. Justin shares his experiences exploring a property under contract in Durango, Colorado, setting a relatable tone for the conversation.

Understanding Market Dynamics:
The hosts delve into the evolving landscape of land investing, discussing how market fluctuations and competition can impact deal flow. They emphasize the importance of focusing on core business operations while evaluating new market opportunities.

The Importance of Professionalism:
Justin and Clay highlight the necessity of a professional approach in land investing, stressing the significance of having robust systems and processes in place to achieve consistent results, especially when entering new markets.

Data-Driven Decision Making:
They discuss the critical role of data in empowering investors, explaining how access to information can influence pricing and negotiation strategies, ultimately leading to more successful deals.

Building Relationships:
The hosts share insights on the value of networking within the industry, emphasizing how strong relationships can open doors to new opportunities and collaborative ventures, reinforcing the importance of community in land investing.

Value-Add Opportunities:
Justin and Clay explore the importance of identifying and creating value in land deals, encouraging listeners to think beyond simple flips and consider long-term strategies for growth.

This episode is packed with practical advice, personal anecdotes, and actionable insights that can help you navigate the complexities of land investing. Whether you're a seasoned investor or just starting out, this conversation is essential for anyone looking to master the art of market selection.

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Transcript

Clay Hepler (00:00)
Hello and welcome to another episode of the Ground Game Podcast. This is your co-host, Clay Hepler.

Justin Piche (00:06)
And this is Justin Piche and we're here to show you how to win the ground game.

All right, so this is take two. We had some technical difficulties on our last podcast recording, and we just felt it wasn't the right product to put out. And so we're to take another swing at it. I we've never repeated a podcast before, maybe this is, you know, with a second round through, maybe this will be a little more polished, who knows? What's been, how was your weekend, man? What's been going on with you?

Clay Hepler (00:40)
In my pit.

Dude, as you know, Smashcake, right? Yeah, sent you some photos. It was pretty dope to have. We had about 26, 27 people in my house. It was an amazing event. I was saying to my brother-in-law, said, you know, my wife should take notes because next year's my 30th and so I hope my 30th is as good as my son's first. Just a joke.

Justin Piche (00:47)
That's right, you sent me some photos. Beautiful, it was beautiful.

Clay Hepler (01:13)
yeah, so dude, it was great to have everyone here. My mother-in-law and father-in-law are still here, which is great. they're here until Thursday and it's Tuesday. so we're going to be spending time with them tonight, spending time with them the rest of this week. I also golfed on Sunday, played nine holes. Dude, it's amazing. I know we were talking about this. The problem is, and you and I were talking about this earlier with someone, we were working with someone to

underwrite his development deal. And like, where's the time?

Justin Piche (01:47)
Yeah, I know.

Clay Hepler (01:49)
If you want to get good, you have to practice a lot, like two times a week, two times going out a week and really practicing. Now you have to sacrifice other things. Maybe that's working out. Maybe that's something else, but when you have so many kids, it's really hard to prioritize that.

Justin Piche (02:09)
Yeah, no, I 100 % agree. You know, the first time I ever picked up a golf club in earnest was when I was in the Navy. I was in my early 20s and I played so horribly. In fact, I don't remember who it was, but my first round of golf, I played with a buddy of mine. name was Brian Lucas. We were in nuclear power school together in Charleston, South Carolina and there was a...

a course there in Mount Pleasant area that we played at. And it was just the two of us. So we got paired up with these two much, better older golfers. And one of them was an ex-SEC football coach. And I don't remember his name anymore. But I he was like, was either the South Carolina or, I don't know, he was some football coach. he, I think I won whole, I got like to 10 strokes and he's like, son, pick up your ball. You he's just like, you can't.

It was really stressful for me my first full round because I was just going with my buddy and I was learning and I wanted to play. But I just kept whacking it in terrible places. And then every once in a while I'd have a good shot. those couple of years that I was like before I started deploying with the Navy, I was able to play a lot and got down to be like an upper 80s kind of golfer on average, maybe a 90 round and 87 round, which many people would consider decent.

Clay Hepler (03:14)
Ha ha ha ha!

That's solid.

Justin Piche (03:34)
That's like an, you're an okay, you can play with anybody because you're just like an extra stroke per hole for it from a scratch golfer, which is totally acceptable. Play fast. And then, and then I started having kids and I mean, I'm not going to go spend a Saturday away from my family, you know, and Sunday is church. Like I'm going to church. I'm not going to skip church to go play golf. now that I have run my own business and I can manage my schedule, business is just so busy.

I don't know when, like, when am going to play golf, you know? So I probably play once or twice a year. Actually, we were talking about this too. I've got a big golf trip coming up, which is not something I normally do. But my cousin organized the trip. And so me, a couple of cousins, a couple of uncles are going to Pinehurst for six days. And my wife, she's like, are you kidding me? You're going to play eight rounds of golf and you're going to leave me with the kids for six days. And I was like, I'm so sorry. I truly.

truly did not realize that my cousin was planning such an epic trip. But I tell you what, a couple years ago, he had this idea. He like, hey, we're going to go on a trip in a couple of years. Let's start buying Bitcoin, a hundred bucks a month of Bitcoin, and we'll just put it in a big pool and we'll see what happens. Then we'll use all that money to fund a trip to go golfing.

A few years ago, I started putting in 100 bucks a month. He sends me a Venmo request. I send him 100 bucks. He buys some Bitcoin and stuff and whatever else he does. And I think I've put in maybe 3,500 or 3,600 bucks over the last three years. And I don't know what it's worth now, but at least a couple of weeks ago, it was up at over 10 grand. So I told my wife, I'm like, look, this trip is basically free. It doesn't cost me anything because my money that I put towards it has already earned enough money to pay for the rest of the trip. So at least it's not a money thing.

Clay Hepler (05:26)
I'm sure that totally works, I'm sure that totally worked.

Justin Piche (05:27)
yeah, she couldn't she could not have cared

less. She could not. She's like, what you've been sending your cousin 100 bucks a month. That's she said. it's so funny. Anyway, I digress. But man, my weekend was rough. My wife actually went out of town on a girl's trip to go skiing. She went to steamboat with a couple of girls, which I encouraged her to do because of my golf trip. I was like,

Clay Hepler (05:36)
Ahahaha

Justin Piche (05:56)
She was to me, what other moms do you know, Justin, that would leave their children for multiple days to go on a girls trip? Like who am I going to go with? And I was like, I don't know. Like you have to plan something or ask people. And so that night that we were talking about that, she went to our women's Bible study at our church and it was, you know, probably lament, she was probably lamenting a little bit about my golf trip and how absurd it is that I'm going to leave her with all three kids while she's still working.

Clay Hepler (06:16)
15 people signed up.

Justin Piche (06:26)
Mind you, not stopped. She hasn't stopped to work yet. So it's like, you know, from a Sunday through Thursday lamenting. And I'm sure the other ladies were commiserating with her and being like, yeah, that is absurd. Because frankly, it's absurd. I recognize that's an absurd amount of time to leave your wife who's working with their kids. And I'm not proud of it, but I've committed to it. So I'm going to go to it. And another one of our friends, my buddy Colin, his wife, I was talking to my wife and she was like, yeah.

Holland's going on these two guys trips. He's out of town for these weekends. We should do something. And so they got together and another woman from our church and they all flew up. And actually my cousin who lives in Golden drove up and met them at Steamboat and went skiing with them and spent the night. They had a really great time, but my kids got sick this weekend. So I think when we recorded the first episode of this podcast, I told you the story of my daughter getting sick. And okay, so she got sick.

Clay Hepler (07:18)
Yeah.

Justin Piche (07:21)
I got sick all Friday, I was pretty, yeah, Friday morning or whatever was pretty, no, Thursday. I was sick Thursday. We recorded, I wasn't feeling great. And then my son got sick on Saturday, Saturday night at 3 a.m. He walked into my room. So we couldn't go to church on Sunday because he was sick and not doing well that morning. That was the rough part, but otherwise we had a great time.

Rode a lot of bikes, took the kids to parks, went and hung out. it was just, you always talk about, no golf, but you always talk about when you get a day with your son, like how fun it is. And it's just really fun to spend time with the kids and go around and just go outside and watch them play. And we had a movie night and all kinds of fun things while my wife is gone.

Clay Hepler (07:55)
No golf, no golf.

That dude, that's

awesome. Did your wife have a good time?

Justin Piche (08:15)
She did. Yeah, she had a really good time. came back last night. She came back last night and right in time for to say good night to the kids. And yeah, she had a really good time. So.

Clay Hepler (08:24)
Beautiful,

beautiful. Well, they're talking about stories. We're to talk a little bit about some stories that we've experienced over our time as land investors. It's interesting. Well, on social media, everyone puts out their best foot forward. And a lot of times good things really do happen in this business. This business can completely transform your life, but it also can throw a wrench in your life. It also can...

be incredibly stressful. also can, there could be business ending things that happen to you. we're gonna talk about this today. I wanna start, talk about a little deal that came across my desk a couple of weeks ago. I was super excited about it.

It was submitted, someone that was looking to get help with developing a parcel, beautiful parcel, 116 acre parcel man. I was super excited about it. And as I dug into it more and more, it's one of those deals that is different than most deals. Usually you dig into deals more and more and they get hairier and they get scarier. And you say to yourself, ooh, what did I get myself into, right?

there's gonna be a lot more effort, time, energy, resources that I need to put into this in order to extract the value that I need to get out of it, right? To make it worth my time. Well, as I look in more and more, this deal gets better. And so, one of the things that I really helped this person that came to me for funding is this is how you actually run these deals, this is how you actually build a process to go from, I get this deal on a contract to,

I have this thing fully developed, I have a plan, and I have an ability to bring this thing to market and get the most out of it, while also simultaneously selling these parcels quickly. So we looked over it, we underwrote it, and like I said, dude, it was looking better and better. We talked to local surveyor, a mulcher, someone that's gonna clean out these two beautiful ponds on the parcel. We were gonna subdivide it and couple of pull out these amazing lots in the back of the...

The back of the parcel had this open field, this massive open field and it was like a 60 acre parcel with all this road frontage. And dude, it was, in one part of the parcel, it was gorgeous. It was gorgeous. So I just kept getting more excited. And so we said, you know what? We need to get our boots on the ground. People to go out to the parcel and check it out. Our real estate broker to go out to the parcel. Our mulcher to go out to the parcel. Surveyor to go out to parcel. And check it out, right? Make sure that we have all the right expenses.

that we need in order to properly underwrite this deal, right? And so our real estate broker goes out to the parcel with our mulcher, our dirt mover. And they're looking at this parcel and all of sudden, neighbor Nancy, nosy Nancy, comes up and starts to talk to them about the parcel. And she was asking them questions about, I know this seller's name, let's call him Johnny. Johnny...

he would never clean up a parcel like this, you know, because they could tell the mulcher that, you know, the dirt mover guy had, you know, a dirt mover on the back of his truck because he was coming from a job. And so she was asking all these questions and she being the neighbor, the neighbor that she is, the good serving neighbor called up Johnny and Johnny said, I'm sure you can guess.

I don't have that property on a contract. What are you talking about? And he proceeds to go into this fit of, hey, what's going on? What's happening with this parcel? Eventually, he calls back neighbor Nancy, who calls the broker, because everyone knows everyone in these small counties, who gives the number to Johnny, the number of the

the person who brought me the deal to get funding and operational oversight. and, and they're getting on this phone and this guy, Johnny, had his identity stolen a year and a half ago through scammers, had his ID stolen, his social security card stolen, and these scammers were so sophisticated, Justin, that they actually flew out through the parcel and walked.

every square inch of the parcel because as you know, we've talked about this a million times for long time listeners, in a sales process you want to ask about certain features of the land because that allows you to evaluate the land and offer a different price. Well this guy that was on the phone with this fundee was knowing every inch of the parcel. He knew where the land was, he knew the contour lines, he knew the creek name, he knew where the ponds were.

He's been, he was in the houses. There was like one or two abandoned houses on the parcel, smaller kind of link to houses. It was amazing. So this guy, Johnny, had his identity stolen. He got his car, his car loans taken out on his name. He got furniture loans taken out on his name. And this property's tried to be sold three times. So, crazy story.

Crazy story, the lessons that I learned from this man is like triple, quadruple, quintuple check to make sure that this person is the right person. Asking small questions like, hey, could you send us a copy of your deed when you get a property under contract? And do it in a very benign way. Sometimes sellers think that if they send you a copy of the deed that they sell the property to and you got to explain to them, no, it's just a deed, it's public records. Those types of questions allow you to root out.

potential scammer, but listen they've gotten so much more sophisticated and another thing another lesson is do like take a look at where you're putting your information your public information because Like Johnny told us when we got on the call with him eventually or this funny going to call with him dude when you get your identity stolen it's stolen forever there it's like it's outside of Pandora's box and You're not getting it back and I know people have gotten their identity stolen in for decades

well not decades, but years and years, they've had people that are opening up credit cards. Their life is miserable. So that's a crazy story, man, and just another day in the land investment business.

Justin Piche (14:57)
Yeah, golly, man. I actually have you reminded me of a story, quick story, then I have a really kind of similar one. My brother-in-law had somebody open to somehow he got his identity stolen. Somebody bought a brand new Dodge Challenger, like souped up Dodge Challenger using his information, got a loan from a dealership using his information, crashed the car like

went on a wild ride, smashed the car, totaled it and ran away. And he got a call. was where he works at BP. was sitting in the office. He got like a call from like a sheriff. Like, hey, we need to talk to you like about this wreck and what, you know, criminal stuff. And he was like, what is happening? So he found out that somebody had to open up a loan in his name, purchased a car in his name and then crashed it. Felony charges, whatever, all tied back to him because he owned the car.

And obviously he was able to explain, no, no, no, like I wasn't there. That wasn't me. was my, but he just reminded me when you talked about the car loan opened up in his name. But this, yeah, of course, of course, of course there's no, it was easy to prove that he didn't do any of this stuff, but still it's just nuts. So I, the story that happened to me, that's pretty similar to yours, but it went a little further. was, I was under contract to purchase this property in

Clay Hepler (16:04)
my gosh. He got out of it though. He got out of it.

Justin Piche (16:24)
rural Alabama near a town called Newton. Beautiful property, pastureland, farmland, bounded on the north and south by two roads. So great road frontage. My plan was, I think was 18 acres. My plan was to do kind of one to 1.25 acre mobile home sites. So I'd actually called Clayton Homes, explained what I had.

and we started to go down the route of trying to figure out if they were interested in placing the homes on this or if I could buy a mobile home package or something to turn this into a kind of a more interesting higher margin deal. So I hired a surveyor, I hired a soil scientist to go out there and the surveyor went out to start walking it and I was talking to the soil scientists and both of them were like, hey, there's active farming going on on this property. Do you know when the farm lease ends? Because if we're going to go out,

and stake the property or for the soil test, if we're going to out and dig holes, I need to get some machinery in there to dig all the holes to do the perc tests. I want to make sure I'm not hurting the farmer's crops and I didn't know when the lease ends. you know, this was a, this was a mailer. You know, when you come to think of it, I don't think the lead came in from any marketing we sent. Not only I think back on it, because I remember after going back, after figuring out that this was a huge scam and I'll get to how it was a scam.

going back and trying to find like our letter reference number and where we reached out to the seller. And I don't think we did. think they came in through our website or through an email or something. And, but it was a normal lead. Like we handled it like a normal lead cause it was a good property in the markets we were actively marketing to. And we negotiated a great price on it. It wasn't like a unbelievable price, you know, for a flip, the property was probably worth a hundred to 120. We got it at 60. So it was a solid.

deal, but as a subdivide, was worth north of 300. So it would have been an unbelievably good subdivide with the road frontage and what we were planning on doing with it. we tried to check and see if there's a farm lease. called the seller and it was always kind of shady. It was always kind of hard to get a hold of them, but we'd always end up getting a hold of them. There was a woman and a man that I would talk to. And the owner's name was a woman.

Every time I asked hard questions, she would hand the phone over to the man who she said was her son. She handed the phone to him and he talked. They had an accent of some kind, I didn't think a ton of it. There's tons of people that weren't born in the United States that own land in the United States. The names seemed to match up to the accents. It wasn't anything crazy like red flags right there. I asked them about the farm lease or the lease to the farmer. Who's the farmer that has a lease because there's active farming going on?

And they didn't seem to know what I was talking about and kept asking about, was like, no, no, no, there's like literally crops being grown on this. Somebody is actively farming this land. If you're not farming it, then you obviously have a lease or something. And I threw out some neighbors names. I was like, and if this neighbor is this neighbor, I'd really like to just talk to them and figure out when their lease ends, when they're harvesting their crops so we can line up closing.

So they called me back without having come up with an answer and connected me with another guy. And they said his name was like Farmer Brown or some, it's one of the neighbor's names. And it was a Detroit area code. And the guy had the same accent that these folks had, which then that's when I was like, okay, this is, it's a little weird that.

that multiple people in the small rural Alabama town all have this foreign accent. It's a little weird. Mind you, at this point, we've got the title commitment. We're closing in two weeks. We've got all the docs basically drafted. Settlement statement had gone out. It was a great title company. They were ready to go. They were totally vetted. And these people, these scammers had their social security card ID. They had sent in notarized documents already. They had everything.

taken care of. The title company was moving forward and ready to close. But after that second call with the guy in Detroit, I was like, why do have a Detroit phone number, but you live in Alabama and you farm in Alabama? And he didn't really have it. He's like, well, I'm from Detroit, but I have my farm in Alabama. You know, some like weird answer like that. What were you gonna say?

Clay Hepler (20:43)
I was gonna ask that. That's what I was gonna ask.

Justin Piche (20:45)
Yeah, no, I asked the question and they had some answer, but it wasn't a great answer. So I was like, this feels super weird. I skipped trace the lead because this wasn't a co-call or a text lead. So I didn't already have this person's phone number other than the phone number that we had in the system from them giving it to us. So I skipped trace the lead and I tried calling all the numbers. I used direct skip at the time. So I had like her numbers and I had relatives numbers and all these different numbers that I tried calling and I couldn't connect with anybody.

And I went on Facebook and found her and tried to like search for her name and her city and town. And I found one match that seemed to be the right person. So I Facebook messaged her, but you know, it's like a cold message. So if you ever get a cold message in Facebook from someone you're not friends with, it kind of puts it in a little separate box. It's like something you have to accept. And so it's kind of hard to see sometimes. So that took a while. She didn't answer there. And then finally she called me back from a voicemail, left a voicemail on me. I called her back and we talked and I was like, Hey,

This is going to sound really weird, but I am, do you own a property in blah County? She's like, yeah, this is my family land. It's been in my family for a hundred years. Leo, blah, blah, blah. Like, well, this is going to sound really weird. I just need you to hear me out. I have this property under contract to buy. I'm currently it's at title. I'm two weeks away from closing and buying and you are not the person I've been talking to to buy this land. And I, you're being scared. Like I think you were being scammed. think somebody has stolen your identity.

And we ended up working it out. Obviously I didn't buy the property. told the title company. even, I even filed an FBI like report. Like I went into FBI system and like filed this like claim. I never heard anything back. Nothing. don't know. I don't know what happens to that black box of the system. I'm sure they get tons of inquiries and don't have the resources to investigate even a fraction of them. I never heard anything from it. but yeah, it sucked. was like ready to go, you know, lost. I didn't lose that much money. A few hundred bucks on kind of drone and

you know, some deposits and things like that. anyway, it was nuts. But I, yeah, there was nothing that would have stopped me. If I had wired that 60 K title company would have closed. There was nothing else stopping them at that point. Just intuition. And maybe the lesson to take from that for anybody is, is you gotta, you gotta dig in and you gotta send people out there. I know Clay had mentioned that you gotta send people out to the property and you gotta ask the right questions. This actually

Clay Hepler (22:56)
Yeah.

Mm-hmm.

Justin Piche (23:12)
When I was at a couple of years ago, was at Clint Turner's Learn Land, one of his Learn Land conferences in Dallas. And there were some Canadian investors there that I met and we're talking to. And they actually fully got scammed. They got scammed. They bought a property in the U.S., wired the funds, funds went to the seller. They'd never met him, obviously. They'd only talked on the phone, sent some emails, got away with the funds. It was some

somebody in like Vietnam or something. And they ended up having to go through a title claim and have the title insurance policy payout. so the, you know, transfer the title back to their rightful owner. And it was a mess, just a mess.

Clay Hepler (23:57)
Wow.

Justin Piche (23:58)
So it happens.

Clay Hepler (24:00)
It happens, man. think it's even more like you see in the news. I mean, of course, the news is an over exaggeration of what's actually happening, but there are people that get calls with the same voice tone. Like it sounds like it's me calling like a mother or father. And they say, you know, hey, I'm really hurt. You can't call anyone. And I need you to wire me this money because I'm really hurt and I'm so embarrassed about it.

Right? people, older people get scammed for like hundreds of thousands of dollars because they hear their son or their daughter or a loved one and they're, you know, they care about this person and they get manipulated into wiring these people funds. Um, and then they get so embarrassed about it. So they don't tell anyone. So it's just like self closing loop. Um, so there's like safe words that

Experts talk about using with your family when someone calls who use these safe words so that you don't like You know pineapple or whatever it is map or something like very unusual To verify that that person is the right person that's calling you

Justin Piche (25:15)
Hey guys, this is Justin quickly interrupting your podcast to say, Hey, I hope you're liking these stories we're sharing about the things that can go awry while you're land investing. If you've got anything to share, pop it in the comments. We'd love to hear what you, what you guys have going on and what crazy story you have through your experience, land investing. Now back to your regularly scheduled programming.

It's insidious, It's insidious.

Clay Hepler (25:40)
It's insidious.

It's insidious. So I'm going to.

Justin Piche (25:43)
So don't let that

happen to you, listener. Don't be scammed. It can happen. If you do enough deals, if you look at enough properties, it will happen. It's not when, it's not, yeah, it's not if, it's when.

Clay Hepler (25:46)
Yeah.

It's the first time it's happened to me. It's the first time it's happened to me.

Yep, I agree with that. So the second story is actually different than the one that we told with the poor technical difficulties. I want to keep you on your toes, You know, I want to keep you engaged and on your toes. Okay, so a couple, so last year was when I really started hiring acquisition managers in my business. So before that,

Justin Piche (26:04)
good.

Yeah, I love that. I've got the same story, but it's a good one. So all right, let's hear it.

Clay Hepler (26:22)
I had virtual assistants and myself who were closing the majority of the deals. I learned through a lot of pain, a lot of suffering, that American acquisition managers are really hard to beat. Really hard to beat. And a good acquisition manager is worth their weight in gold. And so, what I did last year is I hired an acquisition manager, and right before I had a child,

And so he was my acquisition manager when I had a child, my first, the one year old, and then eventually didn't work out and then I hired another acquisition manager, right? And at that point, I hired an acquisition manager, gave him a salary, gave him a pretty decent salary, and then gave him a percentage of profits. Now, there was a couple of things that I messed up with this hire. And I'm gonna talk about what I messed up with the acquisition hire and then what I should have done instead of hiring him.

Right? So the first thing that I did messed up was I took him from a referral, Justin. And the referral is a guy that I trust, very high level professional business owner. And I, at the beginning, of, I met with this guy on a Zoom meeting and I'm actually friends with him today. So I'm still friends with him. He's no longer with me, but still friends with him. And he was traveling around the country and

in like a van and had like really crappy internet and like during our call like his internet dropped and I didn't really vet him that much but I called his references, there weren't that many and they're like, yeah, he's a great sales guy and I could tell he's a very charismatic guy. He's an incredibly charismatic guy. But I kind of just hired him to hire him and I didn't really think through that hire and

I knew pretty quickly that he wasn't the same type of dude that I was. He wasn't the same type of person that fits in my culture. That is, I'm really high energy, I'm really hard charging, I work really hard, I have those expectations of proactive communication, total ownership, speed, moving really quickly, and competitive greatness. And man, that's not for everyone, that doesn't mean that...

There aren't people out there that want to fit within your context. This is really important to know, right? As a business owner, especially starting out as a land investor, man, we don't have enough reps to know what's a good hire, what's not a good hire. And it takes a lot of mistakes, and this is a mistake that you can learn from. So, I really saw him, he actually was a talented guy, but he was the type of guy that would say, I've put in the effort that I needed on a day-to-day basis, which is I called for X amount of hours, and I'm gonna chill for the rest of the day, right?

And I don't think I was mature enough to a certain extent to say like, that's not okay. Like I've said it, but I didn't really directly say it. And so what happened was over a period of time, even though he was producing results, we were making money and I was still jumping in by the way and closing a lot of deals as well. We weren't making what we could have made. Right? So the first lesson here is culture matters so much. And I probably gave up.

Half a million dollars. This was during our first ground game media, know q4 I probably gave up a half a million dollars of profit Maybe three quarters of a million dollars of profit in six months because I had this guy in this seat Now this is no shade on him by the way, he just wasn't wasn't the right culture fit I respect the guy to this day I consider him a friend and he's living out his dream of what he's doing. He's going to travel and so

Like more power to him, he just wasn't the right culture fit for me. So there's a culture fit problem there. The second thing is, I talk about this all the time now, because I made this mistake. Hire first an operation admin, fulfillment, marketing, sales, leadership. Underneath the sales marketing fulfillment admin, you can hire a person to run that.

and operations manager. And for a lot of land investors, I find that their ass is better in the seat of the acquisition manager than in trying to run the business. Because we are a sales and marketing business. And for a lot of visionary entrepreneurs, they're good at building the train and getting that train on the track, but making sure that the train actually gets to the stations when it needs to is not their skill set. And that's okay.

It's not your deficiency as an entrepreneur that you don't, that's not what you, you hire for that. You can hire for that, right? You can hire for everything. And so my big mistake was I hired this person who wasn't a good culture fit and I should have hired an operations person and I sit in that seat longer and or hired someone to sit in that seat like a full commission salesperson which is what I have now.

because my business would have gone, like again, that would have been another half a million dollars, three quarter million dollar profit. And the thing is a higher level operator, a higher level operations manager, not just a $2,000 a month VA from the Philippines, nothing against that, right? They're incredibly good positions for that type of team member, right? But for operating strategic implementation, you're gonna need someone that's a little bit higher pay.

As it relates to an operation manager, there are two buckets that I think of with an operation manager. And within those two buckets, there are different tiers. You have an operation manager, then you have a COO, okay? An operations manager is less about strategic thinking and more about execution.

And the problem is, what a lot of people mess up, including me, is we want a certain person to be everything. We want an operation manager to be able to do everything that we do, make sure that the trains run on time, and think strategically. Now, that person is a very expensive hire. And you might want to layer in

a COO and an operations manager and your way of allocating your capital to the operations manager versus the COO could be very different, right? But those are different things and that's important to know. So those are the two core lessons that I learned.

Justin Piche (33:16)
Yeah, man, that's a good, I mean, it's a good lesson to learn now, you know, rather than earlier rather than later, but it still hurts. It still hurts. I think anybody who's been in business for any amount of time who's had to hire can at least relate in some way to hiring the wrong person, right? Not understanding exactly what they needed or hiring for the wrong attributes. And I think one of the things that a lot of people overlook is that culture fit and then

setting clear expectations and getting commitment and buy-in from the get-go. When you're not an experienced manager or you don't have much experience managing people or hiring teams, you tend, a lot of people tend to say, okay, well, I'm hiring this person for this role. Like they're gonna help define their role and their expectations. And when you hire high quality leadership, for the most part, if you're hiring the right person, they can help do that, but there's still a set of...

expectations that you have. Even if you haven't defined them yourself, you still have them internally. And if you don't communicate them to that person or write them, do the exercise of writing down what is it that I actually need in this person and require them to do? What are the minimum expectations I have for this person that I need to make sure they're committed to before they step into this role? Then you can get into a situation where you have an ill-defined role or ill-defined expectations. The person starts operating and they have some success and it's not bad.

but it's not really what you wanted. And then they get kind of entrenched. And then by the time it wells up in you enough to be frustrated with it, it's like, it's hard to even call them out on it anymore because they're gonna be like, well, I've been doing it this way for months and you haven't said anything. This is the first I've ever heard of this is what you want from me. And it just leads to just kind of bitterness. You start to grow this bitterness of like, man, this person really isn't doing what I need them to do. But now you know, right now I do.

Clay Hepler (35:00)
That's right.

Justin Piche (35:11)
that your expectations are so clearly set from the onset with a new hire that this will not happen to you again. You'll know way ahead of time that it's not the right fit.

Clay Hepler (35:23)
Yeah, I completely agree with that. And there's the whole saying of hiring for gray hairs. And a lot of times, depending on your level of business, you can hire for gray hairs, but man, you gotta pay someone 150K to 250K plus equity if you want someone that's a real baller and that they can define their own outputs. Now you can take it globally.

Right, you can take it globally and maybe pay less than that. But I'm of the position that the US-based COO type, it's really hard to beat that level from an executive leadership perspective. And you can have an operations manager or an operations manager that could eventually get there. I haven't been doing this long enough to really say definitively, so I don't want to speak in absolutes and say it's impossible. It's just...

that the gray hairs a lot of times are hiring them from US based gray hairs. And for lot of land investors, Justin, 200K is their salary.

And so you get into this death trap of the, you one to $3 million depending. I would say for land investors, it's maybe 500K to like $1.5 million. You don't have enough capital to invest in really good talent, like really good talent. You have enough money that you're doing well. And so you as the CEO have to wear so many hats.

And where we've talked about in the past, land investors will put the band-aids of VAs to execute all their tasks. And by the way, there's a great, you know, it works, right? It really works. But getting to that next level that there is a requirement of higher level executives. How have you navigated that, Justin?

Justin Piche (37:22)
I I always put it back to like, I feel like I've gotten lucky, you know, because I made at least at first I made, I made some really good critical hire to really good critical hires very early on when I didn't have what, you know, I would consider the income to support high quality people. But I found people that shared my vision and shared, like had a common kind of culture fit.

And that made the difference early on. People that were bought in from the beginning, as opposed to trying to hire somebody that needed a higher base salary. I hired people that were willing to grow with the company and just lucked out with good employees. But now that I do have the income or revenue, whatever, to support high quality hires, I spend a lot more time focusing on, when I choose to make a strategic hire, focusing on the hiring process.

Like review a whole lot more candidates, have a lot more interviews before making a hiring decision.

Clay Hepler (38:28)
So do you have an executive that you're looking to bring on in the near future?

Justin Piche (38:35)
No, not right now. think we're kind of at the stage in the business now where the departments are managed by the department heads pretty well, like very well. And I have kind of strategic oversight and strategic guidance, but when it comes to setting a vision for the individual departments, like they can do that. And then they're basically telling me what the vision is, and then we're working together to refine it to make sure it meets company goals. And so I'm not.

There's not really a spot in my business right now where I feel like I need to hire a new executive. I've got operations manager on the acquisition side. I've got sales manager on the sales side. I have the key administrative functions currently in place and the stuff that I'm doing now, which is some of the higher level project management for larger developments, fundraising and kind of relationship.

building with other investors and with money partners, et cetera. Like that's really what I'm kind of core focused on now. And those are the things that I want to be doing and that I really enjoy doing. I don't know what the, yeah, that's an interesting question. I guess there's always room to be, guess, further out of the business in a way. And so there may be like a one day of that kind of flipping and small development that's outside of the major developments that I'm working on.

to keep Scout land group alive and keep my employees working and earning an income for their families. Maybe there's a place in the future where I bring in somebody else who's essentially the CEO, or maybe I promote somebody on my team to be the CEO who's making some of the more core decisions for that side of the business if I'm focusing primarily on much larger scale developments or funding or other avenues in this space. But right now I feel busy, but

busy doing the things that I enjoy doing.

Clay Hepler (40:32)
Right.

Justin Piche (40:34)
Yeah, I think that's kind of where we sit.

Clay Hepler (40:38)
It's interesting. Well, I hope that the listeners kind of got benefited out of like, you know, the way I look at hiring, whether it's, and I'm thinking about hiring potentially another very high level executive on my team is the moment that the standards of someone else exceed my own, should hire for that position.

And there are certain things in our business that we do day to day. Like for example, imagine you are, Justin I know you have a story here so I'm not forgetting about you, but I think listeners really benefit from them. Imagine you are trying to build a business that develops marinas, okay? Let's just say you want to build a business that finds land and develops marinas, okay?

You can learn how to develop marinas. You can't, like, of course you can learn how to develop marinas. Or you can hire someone who has done that. And they run that business. And you give them a piece of the upside and you pay them a lot of money to come in and run the entire business. You're probably better off hiring that person. Right?

You know, because if you want to get into a certain asset class or niche, let's say entitling land for a single family home developers or self storage or multifamily, you're probably better off compressing the decades into days and getting, bringing someone on your team. It's going to be expensive. You're probably use a head Hunter. It's going to be really expensive to bring that person on. But if you pay a head Hunter 50 grand and that's probably excessively high, but 20 grand and.

You bring someone on who's $150,000, but they bring in $3 million of revenue in the next year. Is it worth it? Right? Like, so as you scale up, you start to think of hiring, like people are the most important thing of business. And I heard this amazing quote, which really brought this story at top of my mind is, good operators build system, great operators build people.

So that's my story.

Justin Piche (43:01)
That's good story. Thanks for sharing, man. I got another crazy land story I can share. This is my craziest land story.

All right. This is the story that I actually posted about on X last year, or maybe, I don't know if was last year or the year in December, I don't know the previous year. I'm not really sure exactly when I posted about it, but it was my only banger tweet that got.

like viral, I got retweeted by some like big accounts and got a ton of people both invested in a positive way and also invested in a negative way, calling me bad names for doing what I'm doing. Which is fun. You know, that's how you get the most engagement is people hate you, know, the hate, the hater posts. So here's the story. I bought a couple of properties from this guy in kind of rural Alabama, not that rural, but

Clay Hepler (43:52)
Yeah, yeah, yeah, yeah, yeah, yeah, yeah,

Justin Piche (44:02)
but Alabama, which is obviously one of the primary markets I work in. And they were solid deals, really slow property. It had been timbered seven or 10 years ago. And so like, and it hadn't been properly replanted. So it was just like thick, small tree growth, you know, very, very thick, couldn't even move through it. So I got a good price on them. It was these two lots that I subdivided essentially into three lots. created two, take two, turned it into three, spent quite a bit of money.

on culverts, clearing, driveways, et cetera, and then sold them really quickly for a decent profit. I think I bought the lots all in for about 45K. I put 30K into kind of rock work and dirt work and culverts, and then maybe another 10 in other costs associated with it. So I was all in about 80, 85, no bank loan, just all cash. I think I sold them for about 150 total. So made like a 90 % ROI and I don't know, cost six months. It was a good deal.

Clay Hepler (44:52)
good deal.

Justin Piche (44:57)
Well, this guy that I bought one of the lots from had another lot that was 57 acres. And my Acquisitions Manager had negotiated a mid fifties price for it. And we still got it. But he didn't want to move forward on it until we'd already bought his other lot. So once after we'd bought his other lot, then he was willing to start moving forward on this other deal. And so we got out of contract, started investigating, felt like there might be an access issue.

And this is one of the things that I like to tell people is when you get a property under contract, you need to read the deed and make sure there's access. All right. You just look at the deed. If there's legal access, if there's not a public road like on it, the deed will have legal access written into it. If it doesn't, then you likely don't have legal access. So we reviewed the deed. It had an easement written in. So I was like, golden, this is fantastic. Great. So started moving forward, got my surveyor out there, surveyed the property.

The survey showed like potential easement, but it didn't confirm easement. And so I talked to my surveyor who I've worked with on a bunch of projects in Northeast Alabama. a great guy, great surveyor. So we got on the phone and I was like, hey, can you help explain this? My deed says I have access, has 20 foot right of way to this public road, so on and so forth. And he's like, yeah, but there's a lot that your property has to cross, that that easement crosses.

deed does not have an even written on it and it was recorded before your deed. So I'm like, man. So there's no, there's no access, you know, and the whole kind of convoluted story of it is back in the eighties, this property was, sold to a timber company. And when the timber company bought it, they wrote it in easement or purchased an easement or whatever, but whatever they, whatever they wrote the deed, they wrote the easement on that deed. And the other property that the easement crossed,

never got re-recorded with the right easement. So maybe they had paid that person, maybe they had agreed to it, but their deed never had the easement recorded on it and it was a senior deed. was recorded before this forestry company recorded the deed with the easement on it. And so that supersedes this easement. The easement doesn't actually exist because it doesn't show on the parcel that it crosses. And one of the neighbors, his mother owned that property and then she passed away and so he inherited it. And he was...

not happy about people coming out. So because I had listed the property at this point, I bought the property, I'd listed it, I'd started sending people out there and he got really upset that people kept coming across his property, so on and so forth.

So we renegotiate or we, I'm gonna take a step back. We hadn't bought it yet when we started, we've pre-marketed it, so we hadn't bought it yet. And when we figured out the access issue because the neighbor kept complaining about it, we actually renegotiated a lower price to 44,000 or something. Cause I just assumed, hey, it's gonna cost me about 10 grand to buy this easement or solve this via legal method, whatever. Bought the property and then still had issues with the neighbor. I sent my...

guy out there, one of my contractors who did a lot of work for me putting in driveways, fencing, whatever, because I just wanted to clear. It was already really nice, but wanted to clear a path through the property, kind of clean up some of the green fields on it, lay gravel down between where my property starts. was like a, it was like a 50 acre block and then a 20 foot kind of neck that, that from my view touched the paved road. And I wanted him to put gravel down from the paved road through the neck to the back to where the property opens up.

and then put a gate in. So he drives up, he gets his all scheduled, he gets his big dump truck full of rock and gets his truck with his trailer and equipment and all that kind of stuff on there. And the neighbor comes out and confronts him and they start saying some not nice words to him, to each other basically. And the neighbor's son comes out too and is like trying to calm the situation down. And eventually the neighbor gets fed up, goes back to his house, comes back with his truck wearing a coat.

which is weird because it was warm out. And at that point, the son like came up to his dad, like kind of hugged him and like pulled him back. And then my contractors, he's telling me a story like that man had a gun, you know, and luckily I had my gun too, whatever. So finally he realized, okay, I'm not going to do this. This guy's got a gun. He's crazy. He leaves back down the road. The neighbor follows him two counties, about an hour of driving, takes his truck, follows him with his dump truck, with his equipment to the point where

My contractor calls his buddy who's a sheriff in that county, two counties over and pulls off to the side of the road. Sheriff pulls up, guy gets out of his car. They get into a heated exchange. Sheriff like kind of backs him down and sends him on his way. I, yeah, but the contractor said, I've never been closer to killing a man in my life. That's what he told me on the phone. And it's just nuts. Same guy, same neighbor threatened my drone pilot, which I have on video. The drone pilot sent me the video that he was recording when he threatened him.

in a very like non-shifting, like kind of like code way, but very clear and obvious threat. Anyway, long story short, we finally came to terms and I ended up having to swallow my pride. I had opened a lawsuit against him. We had started the lawsuit to sue for access, not because of anything wrong with him. Like I didn't, wasn't suing him for any other reason than to just establish access, you know, but he had a crazy attorney buddy.

It just was this huge, long process. in the end, I swallowed my pride. I didn't want to pay him for this easement, like a substantial amount of money, because was really only, the court would have probably ordered me to pay a thousand bucks or something. I ended up paying him 12,500 for the evenet, got it recorded, got it done. I made a hundred grand on the deal. It was a great deal. But my pride of not forking over the cash, you know, to pay him upfront, I probably could have just offered him the amount I paid for the easement way in the beginning and, you know, have.

kind of avoided this whole crazy situation. But I just felt that was so unfair to have to pay to cross 150 feet of paved road frontage, know, pay $12,500 for it. It's just nuts. So anyway, I could have elaborated a little bit, but I know we got to wrap this podcast up.

Clay Hepler (51:01)
Right.

Well dude, yeah, yeah.

Well dude, was, I mean like, know, crazy stuff happens like we've talked about in this episode. I hope the listeners got benefit from a couple of stories, right? It's not all sunshine and rainbows and you get deals done, right? You you manage to get deals done, push deals through, but sometimes they fall short because of stuff outside of our control. Really the lesson that I took away from what you said, man, is control what you can control. And sometimes you can swallow your pride and the money, you know, one hand,

Justin Piche (51:20)
death.

Clay Hepler (51:34)
One bird in the hand is better than two in the bush. And if you got a deal on the line and you pay a guy an absurd amount of money, you still get a deal done, it's better than not getting a deal done or getting shot. So, as the listener knows, at the end of the podcast, our gentleman's agreement is look, we put a lot of time, Justin and I put a ton of time and energy into this every week, and all we ask of you is hey, leave a rating review, subscribe, and hit that like button if you're on YouTube so that we can continue to promote the ground game and help you scale your land.

I think we're the only podcast that shares the unvarnished advice and doesn't have people come on and interviewing people and showing people, hey, this is what it takes to be successful. And so the way that we get repaid and what we appreciate is when you leave that rating and review, just put my name first, Clayton had a great episode, I loved his stories, and that would make sure that we really get up in the rankings.

Justin Piche (52:29)
Awesome. Well, thanks, Clay. And we'll talk next week.