Flipping Houses: Entrepreneur vs Investor
December 16, 2014
Do you know how to make money in real estate? Are you into flipping houses? What are you? Would you consider yourself an entrepreneur or do you consider yourself an investor? Defined: An Entrepreneur is “When money, sweat, hard work, time, effort, energy and opportunity make you money”. An Investor is “when your money makes you more money”.
I cannot stress enough the importance of making sure that you have a solid foundation in this industry. Your foundation is what you’re doing in real estate and what you hope to accomplish. Thousands of investors get into the real estate investing business and they enjoy it. For a while. Then they’re out as fast as they jumped in. Why? Their foundation wasn’t solid! We all want to avoid becoming a casualty of the real estate investing war. Let’s discuss what you can do in order to avoid washing out.
When I was first starting out investing in Atlanta real estate, I focused almost solely on the flip, or the buy/fix/sell side of things. I was flipping between 15-25 houses every month. Some of those flips were new construction and some of them were major rehabs. At that time in my life, if someone would have asked me, “Andrew, are you a real estate investor”, I would have replied, “yes, of course I am”!
I’ve maintained a staff of 22 people and I was building and flipping homes. Also I was investing my money and I was buying foreclosures. Fixing them up and then selling them. But when the market collapsed and the bubble burst – I lost all of it. My biggest lesson at the time? I realized that I wasn’t an investor! I thought I was an investor that entire time when in all reality, I was actually an entrepreneur.
If you claim to be an investor but you’re not one, how are you ever going to become one? The problem is that you think you already are an investor! You need to know what you are first. To be honest, I consider myself a little bit of both. That’s what I recommend to my students. It’s likely that you’ll start out as an entrepreneur and work your way up eventually to be an investor. Most of you are outright entrepreneurs. That’s okay! It’s powerful and can make you a lot of money. Just don’t get caught-up thinking you’re one thing, when in a reality you are the exact opposite!
So what do you consider yourself to be? Identify yourself. A quick and easy way to answer this question is this. Say you were to go on a 3-month vacation cruise, not working the entire trip, would you still generate the same income as you would while you’re home? If the answer is no, you’re an entrepreneur. If the answer is yes, then you, my friend are an investor!
