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In this day and age, we are constantly bombarded with data, and it can be easy to get lost in them. And if we are not careful, we can fall into the wrong ones. How, then, can we sift through them and find better data? In this episode, Jordan Fleming sits down with the co-founder of 8020REI, Jesus Toledo, to talk about how they are helping real estate investors do just that! Jesus shares what makes 8020REI stand out from the rest, detailing why he thinks all data are not equal and what process they have in place to obtain better data and build custom outbound marketing plans to maximize the ROI of investors. He also discusses their buy box, the importance of buyers, and their open system. There are so many great pieces of information in this conversation, especially if you want to grow your business. Let Jesus’ insights enlighten you on the importance of better data and why that translates to more deals!

About Jesus Toledo

RETG S2 E2 | Better Data

Jesus Toledo is Co-Founder of 8020REI, a data analytics company that helps real estate investors obtain better data and build custom outbound marketing plans to maximize their ROI. For 8020REI, better data = more deals. They accomplish this by providing highly targeted seller data every month for each of your outbound marketing channel to maximize your ROI.

8020REI’s 3 step process helps you streamline your data and avoid the pains of data management, such as low response rate, poor quality data, data living in a black box, running out of data, or unorganized data storage.

  1. Reverse Engineer Deals
    Send them your closed deals, and use their report to build your custom buy box.
  2. Custom Marketing Plan
    Tell them your outbound goals, and they build your marketing cadence.
  3. Highly Curated Lists
    Niche data done for you. Completely hands-off and ready to execute!

8020REI provides data analytics + intentional marketing cadences for professional investors!

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All Data Is Not Equal – with Jesus Toledo

My co-pilot for this episode is Jesus Toledo from 8020REI. Jesus, welcome to the show. Introduce yourself and the company.

Thank you. It’s an honor to be here. I’m happy to connect about technology. I’ve been a serial entrepreneur my whole life. I’ve been in real estate for several years. I started a second business related to real estate probably a couple of years ago, where we’re doing taxing and data analytics for clients. We pivoted last December 2021, and we’re now focused on data solutions for real estate investors.

That excites me because it’s a discussion I have all the time with people, particularly with my company, smrtPhone. People are calling and working leads on the phone, text messages, etc. The quality of data and where they get data is always a question. I was excited to get you on to talk a bit about how you guys approach it and what’s special about 8020. Give us a little synopsis for an investor who’s looking to start to get better data. What is that journey in general and with you guys?

It’s important to separate a little bit your stage where you are in your real estate career. Data is important, but you can’t get deals out of it. Don’t go super massive and think you need to buy thousands and thousands of records. I would rather go for a pre-foreclosure list. If I were starting a business now, the first data that I would go after and try to master in my market would be the foreclosure or pre-foreclosure before it gets to the auction. That would be the best data source I would recommend for anybody starting. That is learning. Be the master of your market. Know it like the back of your hand. Nobody can know more about the foreclosure process in your market than you do. That’s where I would start as a starter.

As you are growing and if you’re a professional real estate investor starting, it makes a lot of sense to invest in a company like ours or any other high-end solutions where you’re getting high-quality data to help you maximize your return on investment. At that point, you’re sending plenty of postcards, doing a ton of calls, and sending a lot of SMS. Any outbound marketing channel requires you to have high-quality data. One of the biggest mistakes that we see when clients come to us is they think all data sources are equal. Although there are only 3 or 4 main data vendors in the country that gives you nationwide data, how you process the data is important.

RETG S2 E2 | Better Data

That’s the key. I don’t want to say this is a black art area because it’s not a black art. There’s a lot of science and data analytics around it, but for the average investor, it’s a black art area a little bit. Explain to me a bit about that. How do you deal with the data? Particularly, you turn it from, “Anybody can get this data from going to this place,” to, “Here’s data that is going to help you the most.” What goes into that, on the basics?

One thing that I learned a few years ago is the most successful real estate investors in the country have a sales business. I made that mistake for the first couple of years in business. I thought we were running a marketing business. Our goal was to generate leads. As wholesalers, we’re running a sales business. If you keep the focus on that, you’re going to be successful because you can buy leads without doing any data. You can do PPC, TV, and a lot of things, but if you choose to do outbound marketing, be intentional about it. If you have the time and it’s one of your natural skills, learn how to do data. I can give a couple of tips on that.

The most successful real estate investors in the country have a sales business.

If it’s not your skill and you don’t have anybody in your team who is passionate about it and wants to do that, hire a good data vendor solution for you to shorten that curve and maximize the return on investment by all means. What is super important is understanding what we talked about and how to identify or process the data correctly. You will be surprised.

If you go to any vendor, like the typical vendors you can buy a list or subscribe to for a couple hundred bucks and pull the data, you’ll be surprised how many data points you’re missing because the data is not perfect. No data vendor is perfect. We’re not perfect by any means. I’ll give you an example. You’re familiar with the unknown equity list. Everybody is. If you go to any of those vendors, you can pull an unknown equity list. This is just one example, and there are dozens of these. There is no unknown occupancy status. You would be surprised how many properties are based on these vendors who are not owner-unoccupied or absentee owners because they don’t have it, are blank, or have it in the wrong format.

In this case, you’re missing a massive part of the story.

On average, you lose from 20% to 40% of data with unformatted data. That’s why I believe that how you process the data is extremely important. Virtually all vendors miss this and a lot of the columns. Everybody has unknown equity. The absentee and non-absentee are very easy to fix. Some of them, I have, but every time you apply a filter when you’re buying a list, you are losing something.

It’s the difference between knowing you’re reading Little Red Riding Hood and Snow White. It’s that dramatic. If you’re missing something like the occupied status of a property, you’re missing an important part of the discussion that you’re going to have. Your power to go into a conversation with people goes blind in so many ways.

When we started our business wholesale, we were very fortunate. I come from data and marketing. For me, it was my passion. My partner has a sales background, and I had the data. The first thing we said was, “We cannot get the data that everybody else is getting because we’re going to be capped at the results that everybody else is getting.” We went directly to the source. We went to the county. We got the raw data, hired a couple of VAs, and processed it column by column. There are hundreds of columns. One by one, “Can we use it? If we can use it, what are the formats? What is wrong with this? Is it good?” and we fixed it.

That allowed us to close a couple of home runs with zero experience in real estate because we were talking to sellers who had pre-foreclosure, tax delinquent, and everything, but they weren’t on anybody’s list. We were the only ones talking to them. At that point, we had no idea what we were doing. The only way we close that deal is because we’re the only one talking to them. Now that we know, we look back at our most profitable deals, and we can pinpoint and realize that they were what we now call the hidden gems. We now have a process to identify these properties that very few people can get ahold of.

That’s where you start talking about a more niche data experience going to 8020REI. There is a difference between pulling down and hoping and having a very directed set of data. You may have a smaller data set to work with, but I would rather have a smaller data set to work with of super qualified and considered data than I would amass data set of completely unconsidered data because you’re going to have to spend money marketing then, whether that’s cold calling or sending postcards, or whatever it is, you’re spending money.

At the very least, try and be targeted with the money you’re spending if you want success. Let’s take a step back because I’m fascinated by how you guys pivoted into 8020. I understand you had a solution like what we talked about text messaging and some things like that. When you pivoted to a pure data model, and that’s where you are now, did you feel that there was a real appetite or opportunity? Sometimes the appetite isn’t there yet as much because people don’t understand the opportunity it provides. Given the economic forecast and the way things are going to get a bit more fluid in terms of how things work, do you feel like the data element is going to be a critical path for the next couple of years?

It will. The very first time I got into real estate, I saw that as an opportunity. As I read Rich Dad Poor Dad the second time, it was the first time I understood what was going on there. I went to a local REIA several years ago. I came from the online poker world, and that was my first business. I was hosting online poker tournaments and doing a lot of things, working with some of the major brands back in Chile and not here. What I saw in that business was it’s the transition from being dinosaurs playing poker, like people who had money could play poker, to young kids playing poker, but they were not playing poker. They were playing data.

At one point, people were playing sixteen tables at a time with data. All the decisions they were making were based on historical data and how each player was playing. It was the same thing. The very first time I stepped in there, I noticed the older crowd, the guys had been in the space for a long time, and there was this little tiny table with 5 or 7 young kids in their 20s, and I said, “I want to talk to them.” If you notice now more and more, the big guys in real estate are becoming younger kids. That evolution is driven by the data as well. I saw that opportunity the moment I stepped into my first REIA meeting. I said, “The same thing that happened to poker will happen to real estate, and we’re only starting.”

I like that so much, and I agree. I got back from a week-long real estate event in Jamaica. I was speaking at the event, and some guys I was sharing the stage with were young guys, 23 or 24 years old, but they were super focused on the data and crushing it. They’ve got the brains and power and just running the table on it. It was a fascinating watch.

A professional real estate investor without a good data solution, in the long term, is not going to be there.

If you’re not doing it, now is the time to start to get into this game so that you understand how it can work within the markets you’re doing and how you get comfortable with it and work it into your marketing mix. We all have a marketing mix. We all have a way that we’re comfortable with, and then we start to try and push out and get out of our comfort and do more things.

You mentioned the journey people take in their real estate investment careers from starting out awesome, with lots of enthusiasm and probably not a lot of money. The one thing I have learned from the real estate world is if you’re starting out, you don’t necessarily have to spend a ton of money to make a couple of deals happen. It’s, “Get your head down and do the work,” and you can make some deals happen, but if you’re then trying to scale your business to any value and to be able to live, it’s when you start to look towards a solution in yourself.

You start to be very much more considered in your marketing. I have a flip question for you. One of the things I try to emphasize to everybody to who I speak is you want the best data and make sure you do your actions, but you also want to observe the results and inform your next decision. In your thinking process and your analytics around data, do you incorporate the outcomes as well so that you can continue to narrow down?

It’s so awesome that you brought that up. It’s a part of our onboarding process.

Thank God for that because otherwise, I look stupid when I ask all these questions sometimes. Data is not my area of expertise.

How we came up with this part of our product is when we were onboarding clients in the past, we say, “What’s your buy box?” We want to make sure that you’re spending your marketing dollars on properties that you want to buy and the ones that are giving you the most profit. We would ask our clients that. They would tell us what they thought were the buy box. At one time, we came up with this idea, “Let’s do what we call a reverse buy box. Let’s ask our clients the deals that they’ve done in the last few years so we can reverse engineer them and help them build their buy box based on that.” It was a bunch of amazing learnings from that.

Most super huge investors can do all types of deals. They do 80% of their deals, from less than 15% to 17% of their ZIP codes. That’s why we call it the 8020REI. It’s because we always look for what the 20% of properties have in common that generated the 80% of the revenue. That is an amazing learning experience. The reverse buy box is looking back at your deals and trying to identify what the 80% of revenue had in common. It’s an amazing experience. You don’t need to be a data wizard. It’s not super simple, but everybody can do it. Part of our service is helping you understand your buy box.

My gut instinct says it also will take away some of the inherent prejudices. We all have, “I know my market,” but data doesn’t lie and care. Numbers don’t lie and care. That is an interesting element to help people clarify what you are making the most money from. When I was building CRMs for people, I remember building a KPI tracking on lead sources where we tracked it along the way, and we tracked all the events that happened and how many calls and meetings it took. It started to allow them to analyze where they were getting the data from and what leads they were looking at.

They go, “We’re winning some of these, but it’s super costly in terms of time and effort. These ones here are closing quick and easy. We’re making good money. Let’s run to that,” but you only do that if you’re reflective on the set and you’ve looked at it. I don’t know if a lot of people do that on a monthly basis. That’s a new thing for most people. Have you found that amusing for most people?

A lot of people get super surprised with the results in the buy box that we do. We tell them, “What you have been doing and what we see in your market,” and there’s a lot of overlap a lot of the times. What we’re seeing the deals happening in the market and what’s your buy box usually aligns pretty well, but a lot of people get surprised, “I kind of knew, but I didn’t know like these ten ZIP codes are 80% of my revenue. Why am I spending dollars on all these ZIP codes that I have never done a deal with?”

Is it purely the lead gen elements? Are you looking at any buyer habits as well along that way?

We’re looking for both. We’re about to launch a better version of our buyer’s product where people can see what the top buyers are doing and what the prices are. The market is changing. Buyers are an important part of a business, so we’re adding that in as part of our products.

Thinking about your buyers is something that people don’t do enough of.

We’ve been with them for the last couple of years, so if you found a deal, it was easy to sell. We lost that urgency of finding buyers. It is what it is. It’s reshaping that mindset and understanding. We’re doing a presentation for another event that we’re going to be a part of and talking about the pain points of the presentation. We’re saying, “The way that you can strive in any market is to make sure that you buy deep enough and make sure that you have the top people buying. If you buy deep enough and have the right buyer, the most active, and the one paying the most, you have a business in any market. It doesn’t matter where you are.” Is it difficult when you’re going down? Absolutely. It’s harder, but if you keep to those two principles, you get it.

You can strive in any market by making sure that you buy deep enough and that you have the top people buying.

There must be a lot of eye-opening conversations for people when they first start to work with you and the reverse engineering of the buy box and trying to break apart the mindset to be able to think more strategically. You mentioned that you’re in a sales business. At the end of the day, you can generate everything you want, but if you’re not closing and making cash, you’re in the I’m-spending-money business if you’re doing that.

That’s what happened to us. Are you familiar with Gary Harper?

Yes. Gary was at the event with me before.

He’s been my coach for many years. We hired him as a coach. He would come to our quarterly meetings and say, “You have a good business here in real estate. I coach hundreds if not thousands of people a year, and I have never seen anybody like you guys that generate leads, find properties, list process, and lead gen process. You should offer this as a service.” He was the one who pushed us to offer.

In our first few years, we’re thinking we had a lead generation business, and we focused solely on that, but we were not converting. Fortunately, we were very inexpensive. We’re doing the cold call and developed our own texting platform, so the marketing for us was inexpensive, but it wasn’t a reality. If we were buying those services, we couldn’t be in business. The only way we stayed in business was because of that. When we shifted, our wholesale business improved, I started doing the data as a part of a separate business, and that’s when we started growing. Understanding that is super important.

You mentioned Gary. I was with him in Jamaica. He was on stage right before me. I was watching his talk, and I was nodding the whole time. It dovetailed nicely with my talk which was about the importance of technology and thinking properly about technology because he was talking about processes and building those structures. I then came on afterward and talked about technology. All of those things go into building a scalable business.

Properly understanding data and where to focus your effort is something that a mature business does that you learned to do. It must be a fascinating journey when you take people in and start to have their eyes open to, “I’ve been spending money on this ZIP code and this ZIP code, and I’ve never had a single deal. Why do I still spend $2,000 a month on them when I could be spending my money here when I’m getting my deals?”

I’m in a very fortunate position. We work with some of the top real estate investors in the country. We serve them. I still love to talk to our clients and see how our product is. At least once or twice a year, I try to engage with them and review the reports we prepare for them together so we can understand and see what the value is. For me, every time I talk to one of our clients, it’s a learning experience. We’re serving them, but we’re learning. It’s like running our own mastermind. It’s beautiful.

It is beautiful. Before, the guy who ran a rally out of North Carolina, when he was introducing me/talking about me on stage, he said, “Jordan comes here to talk to customers,” to get face to face in a room with customers, to hear the good and the bad, to feel where they’re going, and moving around is such a valuable thing. It’s great that you’re getting a chance to do that because it informs so much about where you can take the technology.

We’re real estate investors as well, but I don’t want to be biased by what I think. It’s easy to, “This is the best way to go.” Having the ability to engage with your client consistently is super powerful in the product development roadmap and understanding how you market your product. It’s key. Talking to customers is extremely important. A lot of the things we’ve built, the vast majority of them, have been from conversations with customers.

For us, as well. We build your features based on what people are wanting. We’ve had a good flavor of the way you approach data and markets for investors. The first part is getting the right data, and the second part is acting on that data. If they’re using you guys, they’re probably mature enough to have a relatively robust CRM system or methodology that you’d hope. Otherwise, that would be an amount of money they’re spending for no real purpose. If I’m an investor, I’m liking what I’m hearing, and I want to work with you, are you able to work agnostically across the different platforms?

Yes. Internally, we are like the Android of data. We’re an open system. We’re not Apple. Apple is a closed system. You can’t connect a bunch of stuff. You’ll have trouble on Apple products. Our data works with any connects. We’re working on building integrations with different things. The first thing is when you sign up with us, you own or get every single parcel in the market that allows us to identify the hidden gems that we call. You can bring it to your CRM or another list stacker.

We have a list stacker internally. A lot of our clients use us not only for the data but also hosting or putting everything together. Let’s say we have pre-foreclosures in our database, but you have a process to gather the freshest foreclosure directly from the court. If you bring it to our system, since it’s an open system, it’s going to make our data better, which will give you better data at the end. It’s a hub for all your data.

You mentioned something that reminded me that data is super important. It’s the starting point if you want to grow your business, but how you use it is extremely important as well. We help you identify who is more likely to sell at a discount, but that’s a very small subset of properties. If you want to grow, you have to engage with other properties. We help you identify who is more likely to sell them the average property. If you grab all the properties in your market and target every single one of them, we’ll help you, but how often you engage with them is almost as important as having good data.

Getting high-quality data is super important, but it’s identifying tiers on who’s more likely to sell and building an intentional marketing plan based on it. For example, if you’re doing direct mail and putting them on a 30-day cycle, 60-day cycle, or 90-day cycle, it is extremely important. That’s one of the things that we do. We help our clients not only, “Here are the best properties,” but we also tell them, “This is how you engage with them.”

You give that consultative approach to them to try and give them more guidance around the interactions they can do. That’s pretty amazing. I’m going to straight into the fast five questions that I ask all the technology partners that come on. Some of them you tend to answer throughout the conversation, but I’d like to sum it up at the end. Question one, what feature of 8020REI has the biggest impact on your customer’s business, in your opinion?

It is the algorithms that we build to process the data to give you properties with little to no competition.

Question two, what is the biggest mistake people make when they start looking at data?

They assume all data is equal, and it’s not. As I said, how you process is extremely important. Processing and using it are two components that a lot of people think, “I’ll get this list and mail them every month.” It doesn’t work that way.

I 100% agree with that. Question three, if someone was just starting out to get towards integrating proper data, has gone past the start stage, and wants to take a step forward, what would be your best advice on how they could start?

If you want to do it in-house, get raw data and process it yourself. Take the time to understand every little column you can get from data and be intentional about it. Once you identify the property that is more likely to sell, build a marketing plan. Don’t spray and pray. It doesn’t work.

Be intentional about data. Don’t spray and pray.

Spray and pray drive me nuts.

It doesn’t mean that you can’t do volume. You can do hundreds and thousands of properties, but how often you engage with them is super important.

This is a follow-up to the first question. What’s one thing you wish everyone knew about 8020REI?

For our existing clients, I wish that everybody follows our recommendations on how to use the data. We tell them, “This is the way that you call.” Apart from the list, we recommend them calling 3 times a day for 10 days in a row, but the thing is, they probably use your call center, and they tell the call center, “This is the list,” and there’s a disconnect there. If anybody knows a good call center we can connect with and maybe teach them how to do it so we can serve more people, I would love to connect with them. Reach out to me.

This is going to be a broader thing. As you have a real estate business, if someone’s starting out in the real estate investment game, what three bits of technology would you recommend they bring on first? What would you say as someone who’s been there and done that?

If you’re starting out, be organized. That can be on an Excel sheet, or it can be a good CRM. A CRM is important. It doesn’t mean you have to break the bank to get it. Make sure you have a good phone solution so that you’re not missing calls. Those two things are super important and anything to help you start tracking your numbers. That’s not necessarily a technology because it could be in your CRM, Google Sheets, or Excel. That’s almost technology. Start tracking your numbers from the beginning, so you know where you’re going and what’s happening.

Start tracking your numbers from the beginning, so you know where you’re going and what’s happening. 

Also, so you know what’s working and what isn’t. Jesus, it’s a pleasure to talk to you again and to get a chance to geek out and listen to you and your thoughts on data. To close out, tell people how they can find you guys and how they can get started. I’ll leave you to close out the show.

First of all, thank you so much for having me. It was a blast. I love that we sync in technology. There’s not a lot of talk about technology in our space, so thank you for your show. It’s going to help a lot of people in that regard. If you want to learn more and you’re a professional real estate investor or are already doing 30 to 50 deals a year, and you want to ramp it up and do high-quality data, the best way to reach out to us is through our website 8020REI.com. If you mentioned that you heard about us in this show, you got a 20% off the onboarding fee. That’s pretty much it. I’m not super active on social media, but if you reach out to me, I’ll love to connect.

You can also find 8020REI on The Technology Store page of my website to make sure that you have an easy way of getting access to them. Do make sure that if you’re reading this, give the show a like, subscribe, and review. It does help bring the concepts around real estate technology to a wide audience as possible. Jesus, I’ll catch up with you soon, and have a great week.