Jill Friday – How We Failed at Hiring (LA 1518)
Jill Friday – How We Failed at Hiring (LA 1518)
Transcript:
Steven Butala:
Steve and Jill here.
Jill DeWit:
Happy Friday.
Steven Butala:
Welcome to the Land Academy Show, entertaining land investment talk. I’m Steven Jack Butala.
Jill DeWit:
And I’m Jill DeWit, broadcasting from pretty Paradise Valley, Arizona.
Steven Butala:
Today is Jill Friday. She’s going to talk about how we failed at hiring, and bring it home this week. Before we get into it, let’s take a question posted by one of our members on the landinvestors.com online community. It’s free. And if you’re already a member, please join us on Discord. This question is two parts.
Jill DeWit:
I see that. There’s different dates, so this us going to be good.
Steven Butala:
So this is Austin asking a question on May 4th, and we’ll read the question.
Jill DeWit:
Uh-huh (affirmative).
Steven Butala:
And then a million people in our group and outside of our group respond.
Jill DeWit:
As a follow-up.
Steven Butala:
Two or three weeks later, he gives us his decision.
Jill DeWit:
Okay, good. Okay. So this is Austin on May 4th. “Hello. I’m writing this in response to podcast number 1479 about recovering landlords.” This is good. “I’ve owned a duplex for about 10 years. Cashflow is about $600 a month, depending on expenses. If I was to sell it right now, I could gross approximately $220,000 after paying off the underlying mortgage.” I remember this, by the way.
Steven Butala:
Mm-hmm (affirmative).
Jill DeWit:
“The real estate fees and other taxes would still need to be subtracted. I’m not sure what this looks like tax wise, until I have a chat with my accountant. Would you guys hang on to this asset and let rents and equity just go up? Or would you sell it and take this money and apply it to property acquisitions? I could also do a cash out refinance as well. Thoughts? Thanks, Austin.” And a lot of people wrote in on it. I think I wrote in on this too, if I remember correctly, and I know what I said.
Steven Butala:
Jill and I said sell it.
Jill DeWit:
Mm-hmm (affirmative).
Steven Butala:
The vast majority, if not every single response, and there were tons of them, said to keep it.
Jill DeWit:
Really?
Steven Butala:
Yep.
Jill DeWit:
Okay, so this is good. So here’s the follow-up.
Steven Butala:
Bear in mind, it’s cash flowing $600 a month.
Jill DeWit:
$600 a month. Not counting the headaches.
Steven Butala:
That doesn’t pay our utility bill.
Jill DeWit:
And the alcohol that he needs to consume for the headaches that go with this. I would spend that $600 easy. Okay, so Austin wrote back on May 21st. “Hello. So my question made the podcast.” Yeah, it did Austin. Yeah, episode 1501. And now you’re back too. I don’t know what episode we’re on today, but anyway. “I would have responded sooner except I was out of town doing important rural land research.” Good for him. “I was comparing different areas and how affluent the flavor of wine and how they influence.” Excuse me, affluent. “I was comparing different areas and how they influence the flavor of wine and charcuterie plates.” That’s my kind of research.
Steven Butala:
This is the same type of land research we do.
Jill DeWit:
That’s exactly what we do. “After listening to the podcast, I’m leaning towards selling, but for a slightly different reason than it being an underperforming asset. Allow me to go on a tangent for a moment. I work for a small company and my employer is retiring at the end of the year. My current company will shut down. I will have a similar W2 job tentatively lined up. I don’t find my current work very interesting.”
Steven Butala:
Amen to that.
Jill DeWit:
“While I was on vacation, a land buyer contacted me and I set up most of the transaction from my camp site. For the next couple of days, I rode around on a deal high. Many of you out there who have done deals already should know what I’m talking about. Doing land deals is much more interesting and fun than many W2 situations. If I cash out of the duplex, it would allow me to bolt. I have living expenses as well as money for mailers and acquisitions. Deal funding is still an option if I really want to swing for the fences. I have an appointment to meet with a realtor soon. I’m excited about what the possibilities are. Take care, Austin.” So it was him getting outside going, “I don’t want to do this.”
Steven Butala:
If I was your father I’d shake your hand and give you a big hug and say, “You’re doing the right thing.”
Jill DeWit:
Yay. I got goosebumps.
Steven Butala:
Me too.
Jill DeWit:
Oh, I’m so happy, Austin. Good for you. And there’s always going to be that W2 job if you really feel like you need the security blanket, but if you go all in, you’re going to be just fine.
Steven Butala:
You still get the deal high?
Jill DeWit:
Oh, totally.
Steven Butala:
So do I.
Jill DeWit:
Every day.
Steven Butala:
Me too.
Jill DeWit:
Mm-hmm (affirmative).
Steven Butala:
It’s an addiction. I’m totally addicted to it.
Jill DeWit:
Yep.
Steven Butala:
I can say that happily.I don’t know what I would do without it.
Jill DeWit:
Hi, I’m Land Academy Anonymous. I’m an addict. Hi, I’m a deal addict.
Steven Butala:
We should have meetings for this.
Jill DeWit:
There are. It’s every Thursday at three o’clock Pacific time.
Steven Butala:
Land Anonymous.
Jill DeWit:
Yeah.
Steven Butala:
Land Acquisitions Anonymous.
Jill DeWit:
Exactly.
Steven Butala:
LAA.
Jill DeWit:
Yes, for Land Academy members, Land Academy addicts.
Steven Butala:
That’s a name of a show. I’ve going to write this down.
Jill DeWit:
Yes, write it down. All right. LAA, Land Academy Addicts. Come here. We’ll all talk about it. Yeah, that’s great. Okay.
Steven Butala:
Today’s topic, Jill Friday and how we failed at hiring. This is the meat of the show.
Jill DeWit:
I wrote down three points.
Steven Butala:
Oh, good.
Jill DeWit:
Then I’m not sure, we talked about them, but I wrote down three different points and the three different ways to look at them because have we failed at this? Heck, yeah. Will we continue to fail at this? Heck, yeah. But every time I make a mistake and go, “Oh, not doing that again,” I learn, I get closer and closer to making it better and easier when hiring. And I will tell you too, you need to plan at least a month, at least a month, when you put that first posting up to really be probably talking to the right person. There’s a lot of gunk out there. There’s a lot of people looking for jobs, a lot of people that don’t even read what the posting is and they have tons of waitstaff experience, and I’m like, “I don’t know how that applies, but okay.”
Jill DeWit:
So you have to dig through to find the right people. It’s almost like a mailer too. When the posting first goes out, you get all the junk and then you get the people in the middle that have sat down and really spent some time on it, and the best ones have really spent time on it and wrote you a personal letter and tailored their resume to have the important parts jump out at you that I apply to the position. I love when people do that. Then they really care and they want the job. So how did we fail? Number one, we didn’t ask the right questions. I didn’t ask the right questions. I had to learn what the right questions are. What do you want to add?
Steven Butala:
I have a lot to say about this.
Jill DeWit:
I’m going to go through my list then I’ll let you go.
Steven Butala:
Yeah.
Jill DeWit:
All right. Second thing is, didn’t test enough. I did do some tests. I’ve always done the best employees were when I gave them a test, for the specific jobs that is. One time I had employee that I sent everybody out here. It was a mail merge thing. We needed help. It was part of an O2O position, offers to owners. This was years ago. And I said, “I need you to do a video, make a video, submit it with your application, showing you doing a mail merge. I don’t care what it is.” Oh, it was the funniest thing. I got back links to, it was crickets or links to YouTube videos teaching me how to do a mail merge. Not them even doing it. They just went and found a link like, “Oh, here’s a mail merge. Here you go. Here’s how you do it.”
Jill DeWit:
And I’m like, “No, no, no.” Only one person, and he did get hired, actually did the exercise. I wanted to see, A, do you read what I say? That’s test number one. B, can you work a video? Can you add your own audio? Can you do this stuff for me and properly submit it to me and figure out how to do a mail merge and videotape yourself doing a mail merge on the screen showing me you can handle this task? And only one person did it. And we hired that one person.
Steven Butala:
And he was there for years.
Jill DeWit:
He was there for a long time.
Steven Butala:
He worked out great. He was a good guy too.
Jill DeWit:
We really was. We outgrew him.
Steven Butala:
Well, I think looking back on that, I don’t know if we outgrew him, I think that we hired a supervisor for everybody and she didn’t work out. Looking back on that, I think he’d still be working with us.
Jill DeWit:
That’s true. He might still be here because he was good and his heart was in it. And the third point that I want to make of how we failed at hiring, we’re getting a lot better at this, we did not fire fast enough. There’s a lot of positions that I understand trying to work with someone, I really do, but there’s a point where you’re like, “This is not going to work,” and you’re done coaching and counseling, then you need to rip off the band-aid. As hard as it is, what usually happens with us is, great, whose plate is this now going to fall on and then we limp along a little bit and we’re like, “Oh, we shouldn’t have done that. We should’ve just fired then, taken on the extra workload. Sorry.” We’ll hire as fast as we can for that position. That’s just the way it is, because it’s usually better.
Steven Butala:
The problem that I have with hiring is that it has such a high rate of failure. In everything else that I do in my life or Jill and I do in our lives or the people that work with our lives have a really high degree of success rate. So if I look at all of it, the tens of thousands of real estate deals we’ve done, on one hand, I can tell you, I’ve regretted maybe on one hand four or five properties that we’ve lost on and they were all insignificant losses. And so when you think about how we send out all these mailers and we get these deals that come back in, whether it’s a phone call or somebody sends back the purchase agreement, and then we look at that purchase agreement or the deal itself and we go through our due diligence and our acquisition criteria, and if we’re on the fence about it, we don’t do the deal.
Jill DeWit:
Mm-hmm (affirmative).
Steven Butala:
Years ago, we probably would have done it because it was harder to come. We just didn’t have it all figured out, but now we have it figured out and so do the Land Academy members. So translate that methodology to hiring. If I could send out 10,000 letters to really logical candidates in a database somewhere that all, let’s say, have the training to do a mail merge, I’ll go and use Jill’s, I know in this database and they know how to do a mail merge to this level, send out all those mailers, 20 people call me back or whatever number, and then we look at those 20 people and all the facts about those 20 people are factual, just like a real estate deal, it’s got access, there’s got [inaudible 00:10:45], it’s got a great attribute, it’s large, it’s cheap enough, I can see all the surrounding prices and stuff, we’ve got to do this deal, then we would have a huge success rate in hiring. But we don’t because people lie. They lie about their education. They lie about their capabilities. They lie about their personality.
Jill DeWit:
No, I’m not crazy.
Steven Butala:
They dress up really well and speak in full sentences, and then two weeks after hiring them in an office, you’re like, “None of that stuff was true.” And so that has never happened with a land deal with us because we’re staring at the facts. That’s what’s so hard about hiring, is you just don’t have any facts.
Jill DeWit:
Do you know what my favorite was?
Steven Butala:
That’s why we fail at it.
Jill DeWit:
But we try and we’re trying to scope them out and we do get better every time, and sometimes you just have to go through people. So my favorite story, I’ll end on this, was the person that I hired about two years ago. She came from working for other investors in the L.A. area doing big, big deals. And her particular job in their office was reviewing contracts. That was her only job. And there were two of them. That was their whole thing. And I asked her, “Do you understand the whole flow of a transaction? I know your job is only this one part, but do you understand the whole flow?” And she’s like, “Yeah, I do.” And then, “Can you handle the whole flow?” “Oh God, yes.” and she told me she was bored, which I would be too. I can understand. She’s like, “All I do is read contracts all day. I only get this one little piece of the whole transaction.”
Steven Butala:
She was a great person too.
Jill DeWit:
She was, such a sweetheart. And she came in and she was overwhelmed. She wanted a little bit of faster pace, I think, but she didn’t want this fast. And I could see it happening. I could see her getting more and more stressed. I could see her going home like, “Okay, I’ve got to learn this. I’ve got to learn that. I don’t understand this.” And she really tried. And so what happened was, this is one of my favorites, because it all worked out so well, and she loved us. That was the thing too. She loved Land Academy. She loved the community. She was like, “I love how your members are.” She was like, “I see how they adore you guys. You guys are really doing some good.” It was so nice. She’s like, “I really want to be here and make this work.” And she tried.
Jill DeWit:
So I remember it was like a Thursday night, she was leaving the office and I said, “Hey, just so you know, I see it’s getting harder and it’s okay if this is not working out for you. I get it. So as you’re home tonight at dinner, think about it. I want you to come in tomorrow and have a good day and enjoy being here. And I know you love everything about all this, but I want you to know too that if you think this is too much for you to handle, I will totally understand and it’s okay.” So that next morning, I woke up to a very nice email from her saying, “Thank you, Jill. I needed that out.” And she was so sweet. She’s leaving with a hug. She was like, “I wish I could have done that for you. I love everything about you guys. But gosh, I just couldn’t keep up with you guys.”
Jill DeWit:
And she called it, not me. And I’m so proud of her, because not everybody can do that. She took a look at herself and realized, it would get worse and she would be miserable. And I’m so happy that she did that.
Steven Butala:
And I’ll leave it on this. If you ask anybody, with very few exceptions, this question, do you understand technology? The vast majority of people regardless of age or background are going to say yes.
Jill DeWit:
Because they hold up their phones and they go, “Yep, sure.”
Steven Butala:
“Oh yeah, I understand technology.” What I’m really asking, and it depends on who’s asking this because you as a potential employer are going to ask this, what I mean is, do you have a master’s degree in Excel or a PhD level Excel, and can you actually program in that and do you understand an Access database and do you need a mouse?” And so if I asked it that way, everybody would say, “I don’t even know what Excel is,” except for a very few number of people. Or they’ve been in Excel to do a household budget two years ago. And so technology, this person that you’re talking about was [inaudible 00:15:05] and she was young.
Jill DeWit:
Mm-hmm (affirmative).
Steven Butala:
She was great I’m sure at using Microsoft Word and understood PDFs for her job for reading and reviewing contracts. She was impossible from a tech standpoint.
Jill DeWit:
Yeah. She tried.
Steven Butala:
And I’ve hired people in the past where I’ve said, “Do you understand the technology?” “Oh yeah,” but they couldn’t set up their own computer. And these are people that are 24 years old, they’ve only ever had a MacBook. And we don’t use that. We use desktop computers that are all tricked out because it’s important for speed and all that stuff. So I had to help that person, who’s no longer with us, set up his computer.
Jill DeWit:
Mm-hmm (affirmative).
Steven Butala:
So tech is so important, in whatever your level of tech requirement is, please communicate it to that potential employee and see if they can pass the test. And they can’t, because this business we’re in, there’s a huge tech component to it.
Jill DeWit:
That’s true.
Steven Butala:
We’ve had people at the live event who couldn’t type, they’d never typed before.
Jill DeWit:
Yeah.
Steven Butala:
And they’re asking how to do a mailer.
Jill DeWit:
Yeah. All right, we’re good.
Steven Butala:
That’s why we failed at firing.
Jill DeWit:
There we go.
Steven Butala:
Failed at hiring.
Jill DeWit:
And firing. We’re getting better at both. Happy you could join us today. Five days a week, you can find us right here on the Land Academy Show.
Steven Butala:
Join us next week for another interesting episode. You are not alone in your real estate ambition. God, Jack’s got a problem.
Jill DeWit:
He did. This is a rant week. You guys asked for it, by the way. You definitely asked for it.
Steven Butala:
What’s Jack’s problem with hiring?
Jill DeWit:
Sheesh.
Steven Butala:
Have a heart, man.
Jill DeWit:
I know. Is he a jerk boss or something?
Steven Butala:
Have a heart.
Jill DeWit:
Because the common denominator sounds like Jack. Just kidding.
Steven Butala:
Why would you think, Jack, that people at work have to be accountable? I don’t want to work there. I want to be accountable for my job. There’s people like this.
Jill DeWit:
I understand. Thank you for tuning in. We hope you find our content valuable and we do appreciate your support. If you haven’t already, please get on over to our YouTube channel. That thing is growing and there’s more videos coming. It’s really great.
Steven Butala:
Mm-hmm (affirmative).
Jill DeWit:
And hit the Subscribe button so you will be notified for upcoming things. And please comment on the shows that you love.
Steven Butala:
We are Steve and Jill.
Jill DeWit:
We are Steve and Jill.
Steven Butala:
Information …
Jill DeWit:
And inspiration.
Steven Butala:
… to buy undervalued property.
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