Why do guru sell courses? - Posted by Cire

Posted by SCook85 on April 11, 2002 at 14:04:25:

Steve,

I was at one time hiring employees and outsourcing a ton of work. My phone used to ring over 100 times a day, and I was buying everything I could get my hands on. I’ll tell you, it was a hard way to go. I worked myself to death and your profits get split up amongst all of the people you have working for you. You can’t get homes revovated the way they should be when you are doing too many of them.

I decided that it wasn’t worth getting BIG. So instead I have scaled back. I do less deals. I have no employees. I do better deals. I make more money. And best of all, I hardly work at all! I’ve talked with many people who have similar aspirations to what I used to have, and I just recommend staying small and doing quality deals. You simply can not do mass volume in this business and maintain quality across the board. As soon as quality drops, so do profits because it will catch up with you.

Happy Investing,

Steve

Why do guru sell courses? - Posted by Cire

Posted by Cire on April 10, 2002 at 14:50:17:

Met with a realtor that specializes in doing his own rehabs. He has been in the business for over 30 years. He is going to help me find some homes to rehab. I broached the subject of CREI and his question was if it is so easy and lucrative, why are the guru’s selling courses instead of just making a fortune in CREI? Any takers??

Let’s face reality!!! - Posted by John Behle

Posted by John Behle on April 11, 2002 at 20:14:18:

Many so-called Gurus do sell courses for the money - period. No question about it. Someone like Sheets can make millions off his informercial while sitting by his pool.

Now, that doesn’t invalidate his or anyone else’s information. It’s just that a good marketing plan can make millions with much less hard work than pounding the pavement for deals.

The validity of a course, seminar, service or technique doesn’t necessarily depend on how extensively it is marketed. There are good courses that have been widely marketed for millions to the author. There are BAD courses that have been widely marketed for millions in profit.

There are authors who have great background and experience that have written courses. Some have been widely marketed and others can be hard to find. There are also so-called authors who just plain out re-gurgitate someone else’s material without a whole lot of experience, expertise, morals or anything else. McCorkle seems to be a classic example. My reading of the expose’s on him indicates he never had any serious experience and copied Tom Vu’s course to market - including even generating similar and almost identical phoney testimonials (McCorkle’s).

But? What if Vu’s course was great? I’m not sure, I haven’t seen it - but what if it was? And what if McCorkle did a good job of stealing good material? It could be that you could end up with a valuable course from a total fraud. I don’t know, I haven’t seen Vu’s course. BUT - I did buy McCorkle’s course on eBay a couple years ago - for ten bucks. I haven’t checked it out yet, I was just curious what all the noise was about and wanted to review it someday. I’m not so closed minded or egotistical to think I might not learn an idea or two or see something in a different way.

The sad news, really is over the valuable courses that aren’t written or marketed as much as the courses that are.

The even sadder news is the good and valuable information that is overlooked, faulted or invalidated because the author actually has some character flaws or made some bad business or personal decisions.

Some widely marketed courses have had authors that actually weren’t perfect. I know that is a shock, since everything we’ve ever learned from anything so far in this life came from perfect people, but bear with me.

Contrary to the Archie Bunkers of the industry, it is possible to learn from someone who has actually made mistakes. Based on the criteria some propose, McCorkle’s might be the only course you could consider buying, since if he had never done the business, then he might not have made any mistakes. Except, he probably mentioned the word profit in there and might have had too much white space anyway.

I guess I’m just a little naive. I have an unpopular viewpoint that doesn’t make sense to many people. I believe in learning all I can from all I can. I’m not into checking the resume’s, credit or psychological profile of anyone who tries to teach me something.

Amazingly, I actually attended college classes with professors that earned less per year than I did per month. They rode their bikes to work to save money and cowered in their offices and classrooms safe from the risks - and rewards - of the real world. And, amazingly, I actually learned a little from them.

Basically, I could probably invalidate almost anyone who ever wrote a course in this field and give the “pessimists of profit” fodder for much larger websites. Boy, it would be nice if they were all perfect - EXCEPT for the fact that it isn’t a perfect world. I want to learn from the person coming back on a stretcher from the front lines as much or more than the analyst that hasn’t even seen the front lines for decades. Real estate can be dangerous as heck. I want to know where the mines are not just some textbook strategy from someone too scared, timid, egotistical or downright whimpy to join the battle. Of course, the easiest way to not make a mistake is to lock yourself in a padded room.

It reminds me of a psychologist that wrote a popular book on raising children - locked away in his office - while his wife stayed home and abused his children. I guess he didn’t make many mistakes, given that he didn’t participate. I guess he hasn’t read the studies about the children of workaholics being damaged worse than the children of alcoholics. It’s actually supposed to be an excellent book, but it would turn my stomach to read it.

Anyway, back to “Gurus”. For an extreme example, one excellent course that I would recommend to anyone is hard to find nowadays. The author, going through a divorce, killed himself and his wife. That’s sad. It’s shocking. To me, it’s heartbreaking because I knew and liked them. Probably a big enough character flaw to invalidate everything he ever taught - if that made any sense. It would be a nice sensational item to stuff in a website to help get listed in search engines. Someone could feel soooooooooooo… morally superior.

Ok, back to why Gurus write courses.

1 - Sure, some write them for profits or at least later market them that way. SO what? If the course is any good, economies of scale can help to make it affordable. I don’t care if they sit around in their underware and play poker all day long.

2 - Some write courses because they really do feel they have a contribution to make. Sometimes it is a way of giving back some of what they received. For some, it is a way to help clarify their own knowledge, plan and goals. Some get some ego strokes out of it. Some like to be or be called a guru.

3 - As was mentioned, some do it to help avoid answering questions continually. That can be nice at first, but eventually it grows old. The same question over and over and over can drive you nuts. People can pester you about writing a book or teaching a seminar until you do it. Some educators love to teach and it can clarify your own thinking. Personally, I have learned a great deal from students, formed life long relationships and learned new ideas or ways of looking at things while on my feet while answering questions or solving problems.

4 - Business relationships. Many of the people I work with on a day to day basis are those who attended a seminar or did a home study course. Teaching courses can be a great source of resources and synergy.

I guess that can be good or bad. Many of the courses out there - especially the infomercials - are geared for the purpose of the “up sale”. It may be priced cheaply and be a “loss leader” or low profit.

THEN! The telemarketer gets you on the phone or presenter hooks you at a seminar. A one or two hundred dollar course becomes a fertile ground to sell the multi thousand dollar program that the people “really need to succeed”. Usually that’s where their big profit is. It’s also where gullible students are burned by those that are truly hucksters. In some cases, a good product from a good author is “used” by one of these marketing companies. Even the author gets burned when the company doesn’t perform the consulting or other service as everyone was promised.

When it comes to education, something like this newsgroup and website is extremely valuable. You hear pretty quickly about courses, authors, ideas or hucksters that are dangerous, expensive or impractical. That is the best way to protect yourself and use your education dollar wisely. A huckster can come and go quickly - with their students money. Yet, the value here to the owners and participants is longevity. The participation and interests of everyone helps to insure that there is high value, practicality and protection. Outide that, the beginning student tends to be drawn towards expensive services that promise success, safety and stability. Most don’t deliver.

My 2 cents - Posted by Rick-W. PA

Posted by Rick-W. PA on April 10, 2002 at 20:58:08:

My parents also ask me why they sell courses. They claim that they all make their money by selling their courses rather than investing. It can’t be that bad because my father bought the Sheets course. If I wouldn’t have dug into it, it would have never been opened (Was my third time through in 8 years). To see more examples of this, go to e-bay and search for Carleton’s course. Lots of people buy it and seem to think it’s a magic purchase. Buy it and the money will just start flowing in.

That leads me into the second part of my parents argument. If they are making money from it, then why tell others how to do it. From my own personal experience, I can answer that. There’s something great about teaching people how to do things and watching them go out and do it on their own. I guess it’s a sense of pride like teaching your child how to tie his shoes for the first time(I can only assume since I have no kids).

I’ve been working with a “mentor” for about 2 months now and he’s taught me a lot. He’s a good guy, but I can see us going different directions further down the road. Just a matter of investing styles I guess. When I’m off and running on my own, I plan on teaching my parents how to do this full time, so my father and mother can retire and escape from the “evil” oil company that is XOM. After I’ve taught him, I’ll teach my brother and sister, her fiance and anyone else who “really” wants to learn the business.

There are lots of properties out there. Ones that my “mentor” and I pass up, but we know someone else will hop on it because it’s the kind they’re looking for. There are also people who buy the guru courses, don’t get past the guru’s “kindergarten” course and fall flat on their face (I see them all as kindergarten courses until you actually start living it). Along comes another investor who has graduated CREI “high school” or “college” and bails them out. I think I’m starting to ramble a bit, so I’m just going to close with saying it’s a very yin-yang thing.

If I’m wrong, someone call me on it.

Happy investing!
Rick

Economies of scale in RE Investing - Posted by Devon (Buffalo)

Posted by Devon (Buffalo) on April 10, 2002 at 17:45:53:

This is an interesting question, I think, because it brings up something that I’ve thought a lot about and that is: economies of scale in Real Estate investing.

When you have a successful business concept, and are able to systemize it, the next step for an ambitious entrepreneur would be to “scale up”.

Now my question is: why hasn’t anyone ‘scaled up’ their rehab/dealer business or their subject to business?

I’m only a beginner, so I don’t claim to know anything - but it seems to me, that in the RE game, it isn’t really possible to automate the buying technique. If you taught an employee / partner how to buy (and sell) as well as you can, than I don’t see any reason for them to continue to work for you.

Many have said that finding the money is no problem, but finding the deal is. So… if you teach an employee how to find the deals, what do they need you for? I would think that this employee would go off on his own after realizing that he didn’t need any more knowledge from his employer.

Now you take as an example Homevesters (a Real Estate Franchise), I believe they charge $100k for a franchise license, most of which is spent on billboards in the franchisee?s territory ? basically, I think the $100k is payment for the system. After the system is learned, why in the world would anyone continue to pay franchise fee?s? Granted, there is the consideration of national branding, but I believe that to be negligible. The only thing I see that would stop someone from going it alone after being trained, would be a non-compete clause.

From my point of view, if any of these assertions have merit, I think the answer to the original question ?why do Guru?s sell courses? is: because you can?t scale Real Estate Investing, but Intellectual Property is probably the most scalable business in the world.

Of course most Guru?s create courses to give back and to share their knowledge. I think all Guru?s I?m familiar with are genuinely happy to be able to help others. The icing on the cake for people like Ron Legrand and Carlton Sheets is that selling 500,000 courses for $50 each equals a whole lot of rehabs plus their organization?s need no input from the principals.

I would love to hear what more experienced people have to say about my pet theory.

Regards,

Devon (Buffalo)

Re: Why do guru sell courses? - Posted by SCook85

Posted by SCook85 on April 10, 2002 at 16:55:55:

I don’t like to call myself a guru, but I do market a course.

The main reason I wrote a course was because I used to get on average of a dozen emails a day with people asking me how I do this and how I do that. I decided to put it all in one place so that people could get all of their answers at once.

I make far more investing in real estate then I do with marketing courses. My course does well, but it requires time and effort, follow up, printing, shipping etc… There isn’t a whole lot of profit in them unless you are selling large volumes.

When I wrote my course, I gave everything I had to help the beginner. I wanted everyone who bought it to be able to go out and do deals with more knowledge then I started with. From the testimonials that I have been receiving, I’d say that the general consensus is that people like what I have done.

It is true, there are some people who are in the course marketing business and making more at that then in real estate, but it isn’t always the case.

Happy Investing,

Steve

Re: Why do guru sell courses? - Posted by phil fernandez

Posted by phil fernandez on April 10, 2002 at 15:16:38:

The gurus as you call them have already made their money. Most want to give something back to help newer people get involved in this lucrative business.

Ask your realtor why there is so much back stabbing and mistrust in his line of work. What’s amazing about creative real estate investors is that we enjoy sharing the wealth. We deal from the mentality of "abundance ". The realtor deals from a mind set of " scarcity ".

Re: Why do guru sell courses? - Posted by JoeS

Posted by JoeS on April 10, 2002 at 15:15:52:

Why do the economics experts teach at the college instead of working on Wall St? Why does an expert body and fender man teach at the local Trade School instead of owning his own big business? These are good questions and so is the one you ask.

My take on it is this. Some “gurus” sell courses to make their fortune, some do it to supplement their investment business. This second reason is my reason for doing my investment business 5 days a week, 10 hours a day! My course is available to help mew people. Will I become rich and famous from selling a course? Probably not. I will more likely make more each year doing what I have been for the past 8 years…buying low, rehab, sell retail. I love this business!

I’m sure every “guru” has their own answer, but that is mine, and I hope no one ever refers to me as a “guru”. I’m just a regular guy!

Re: Why do guru sell courses? - Posted by Mike Daly (GA)

Posted by Mike Daly (GA) on April 10, 2002 at 15:09:57:

That’s the same question my brother and uncle asked me. One reason is selling courses and seminars is a very profitable business – say if you have a 2 day seminar for 50 people at $1000 each, that’s $50,000 in 2 days. Pretty good money even if you’re already doing well in RE. I’ve also observed that successful investors do get a great deal of satisfaction from teaching others and liberating them from their deadend jobs.

Re: Why do guru sell courses? - Posted by Michael (NY)

Posted by Michael (NY) on April 10, 2002 at 15:05:05:

I spent years in school listening to professors with Phd’s in Finance who NEVER held a job on Wall St.

The courses are definitions of experiences.
That’s invaluable. You could always learn as you go. I have a feeling that could be expensive.

Re: Why do guru sell courses? - Posted by lynn

Posted by lynn on April 10, 2002 at 14:59:49:

I wondered the same thing before I got started. I sure am glad they sell courses though, my first property was (is) a rental that I put a large downpayment on, got a bank loan and bought in my own name…my what I have learned

I would say they sell courses because there is a market of buyers and they (hopefully) get great satisfaction of passing on their experience and mistakes.

Re: My 2 cents - Posted by Ronald * Starr(in no CA)

Posted by Ronald * Starr(in no CA) on April 11, 2002 at 21:03:12:

Rick–(PA)------------

Thanks for your post. I enjoyed it and I think you show a lot of sense.

I really appreciated your comment: “I’ve been working with a “mentor” for about 2 months now and he’s taught me a lot. He’s a good guy, but I can see us going different directions further down the road. Just a matter of investing styles I guess.” This is a real-life confirmation of what I have said several times to people seeking “mentors.”

I think we all have to develop a style of investing that fits our unique personality, experiences, strengths, weaknesses, and resources. The chance is very slim, it seems to me, that some experienced investor who is willing to mentor you will have a personally-developed style that will fit you.

Thus, I am not enthuastic about people seeking mentoring. I advocate “self-mentoring,” which means figuring out your own path. Assemble your own investment programs by taking bits and pieces from other investors’ programs. Yes, it may take a little more work than following a written-down program. But, it will be much more successful in the long run.

Good Investing and Good PostingRon Starr*****

Scarcity mentality… - Posted by MatthewC

Posted by MatthewC on April 11, 2002 at 14:44:11:

There are lots of people who ask, “why teach it to someone if you can make money at it”. That fundamentally comes from a place of scarcity. That if you teach it, you will pay the price. That there is only so much money out there…

Funny thing is a lot of people have no problems with books in bookstores which are teaching all kinds of things for money, yet when it is called a course, red flags go up. I guess it has to do with the price per unit. No one has a problem with an author selling over a million copies of a book for $20 but people have a problem with people selling 10,000 courses at $200.

Also people have the false notion that because you teach it, most people will apply the knowledge. I find that very few apply all the information they learn.

And before you get excited trying to teach your entire family, you better make sure they even care to learn or change their world. If not, you may be in for a disappointment.

Employees want to be employees… - Posted by MatthewC

Posted by MatthewC on April 11, 2002 at 14:53:52:

I have heard a lot of people say that if EVERYONE learned so and so technique or so and so knowledge, than everyone would want to quit their jobs and there would be no employees.

I have to laugh at that because the truth of the matter is most employees want to be employees or they have to be employees. They like the security and comfort of it. It is the psychological makeup which makes someone an employee.

And many employees who don’t want to be employees don’t have the courage or gumption to make the jump. They are simply discontented employees that just stew week after week, month after month, year after year still being employees. AGain, it is their psychological makeup.

Regarding scaling-up, you will find that people who scale up big-time don’t usually keep rehabbing houses. They either start rehabbing larger properties or they start buying and holding for the very reasons you stated. They simply own a lot of real estate and they no longer keep trying to turnover property. It is easier to place management to run a property than to continually turning property. After all, it is a job and business, not investing as I see it.

Re: Economies of scale in RE Investing - Posted by SCook85

Posted by SCook85 on April 10, 2002 at 19:32:28:

Devon,

I can speak as someone who wanted to take my system national, and their were a lot of flaws that don’t come up when you are trying to take a burger chain or something like that national.

Real estate markets are different throughout the country and require a change in the way you do things from one market to the next. Teaching someone to be able to do what I do in Baltimore in another city is only creating someone to do it themselves. Which is why I prefer to just teach people how to do it themselves, rather then how to do it for me, so they can compete against me, after working for me.

You pretty much hit it on the head. There are many other quirks about real estate that make it hard to put systems in place that will work for “one” company on a national level. Homevestors figured out that you have to have independently owned offices, and create territories. If they tried to run all of the offices themselves, there employees would end up as competition. This is a business that once you have the knowledge you can do.

Steve

I own your course Steve - Posted by Cire

Posted by Cire on April 10, 2002 at 18:57:33:

It is excellent!!!

Phils comments are not just talk - Posted by Robby (VT)

Posted by Robby (VT) on April 10, 2002 at 16:32:35:

When Phil said “What’s amazing about creative real estate investors is that we enjoy sharing the wealth” trust me, he was not just feeding you a line. We recently discovered that we are both in Vermont so he called me today and we setup a lunch meeting for Monday (and of course I will be more than happy to pick up the tab, as well as pick his brain). The only problem I see (based on the posts about the convention) is if we start tipping a few beers I may have to try to get my wife pick me up, LOL (Lots Of Luck).

A Question for You - Posted by Wayne (MD)

Posted by Wayne (MD) on April 11, 2002 at 05:56:47:

Just curious Lynn, what was your first course? Have you bought more than one and if so, which ones? And the really key question: Have you really made any money in this business?

Re: Economies of scale in RE Investing - Posted by Steve-DC

Posted by Steve-DC on April 11, 2002 at 08:16:46:

Steve,

Can you speak to working your system in a large metropolitan area? How have you grown your business? Do you have employees? Interns? Rehabbing crews that work exclusively for you?

Basically, more insight on how (or if) you went from a one man operation to building a larger business…

Thanks in advance,

-Steve