Nikonomics - The Economics of Small Business
00:24:11 · Nikolas Hulewsky, Peter Lohmann
[00:24:11] S1: Okay. That makes sense. All right. So when you hit a 100 doors is like, oh, this is a proper business. It's not, it's no longer, you're just a solo entrepreneur trying to figure out how hire your first employee. What's the next? [00:24:23] S0: Yeah. So the next break point is probably in the 200 to 300 door range. That's where a lot, a lot, a lot of property management companies get to. That's like super common size. I would say that's kind of like the median size. And at that point, you're gonna have a handful of employees. You're gonna have a small office. You're gonna have very predictable revenue every month. You're going to have a set of customers coming in the door every month because you've probably been around a little while. You've got a brand in your local area of some sort. And you could compare that size to, like, of like any old main street business, or it might be similar in size to like a franchise, like if you went out and bought a Smoothie King or something like... Yeah. [00:25:08] S1: At at 300 doors and and I'll just say 200 per door per month, you're at $60 a month, you're doing 700,800 thousand dollars a year in top line revenue. Exactly. And your margins are probably in the 20% range. It's a good business, but it's still, you know, it's not a business that you can necessarily unplug from. Right. And you're like, oh, I got I got an operator in there and I handed it off to them. Like, own that. You're probably also running it in the weeds.
00:25:08 · Nikolas Hulewsky, Peter Lohmann
[00:25:08] S1: At at 300 doors and and I'll just say 200 per door per month, you're at $60 a month, you're doing 700,800 thousand dollars a year in top line revenue. Exactly. And your margins are probably in the 20% range. It's a good business, but it's still, you know, it's not a business that you can necessarily unplug from. Right. And you're like, oh, I got I got an operator in there and I handed it off to them. Like, own that. You're probably also running it in the weeds. [00:25:37] S0: Exactly right. You're not big enough yet to have, like, a whole leadership team where you could step away and and things like that. Yeah. [00:25:43] S1: Let's say at the 700, Mark, is that big enough to have a leadership team where you can step away? [00:25:47] S0: Absolutely. Yes. And so we've got a full full leadership team here at RL, and I actually take a month off every year where I fully disconnect from the business. Yeah. [00:25:55] S1: Not just the business. You're off social media too. I don't know how you do that. I'm addicted. My dopamine receptors would go... Would freak out.
00:25:55 · Nikolas Hulewsky, Peter Lohmann
[00:25:55] S1: Not just the business. You're off social media too. I don't know how you do that. I'm addicted. My dopamine receptors would go... Would freak out. [00:26:02] S0: It's interesting, and this is... This will be coming up here. It'll be my fourth year doing it, I think. It started to become sort of like something I'm known for, but I view that as sort of the goal. It's like you start your own company. That's great. And once you're making some good money, that's awesome too. But until you can really step away from it and come back and you've added doors and someone's been hired and someone's been fired and, like, things are still going good, that's when you really know you've got a true business and you don't... You know, the the sort of derogatory thing that people say here is, like, you bought a job. Right? You don't wanna do that. So
00:26:02 · Peter Lohmann, Nikolas Hulewsky
[00:26:02] S0: It's interesting, and this is... This will be coming up here. It'll be my fourth year doing it, I think. It started to become sort of like something I'm known for, but I view that as sort of the goal. It's like you start your own company. That's great. And once you're making some good money, that's awesome too. But until you can really step away from it and come back and you've added doors and someone's been hired and someone's been fired and, like, things are still going good, that's when you really know you've got a true business and you don't... You know, the the sort of derogatory thing that people say here is, like, you bought a job. Right? You don't wanna do that. So [00:26:38] S1: It's like, yeah. It... But I bought a job that I'm the only person I could fire myself from. So Yeah. I... I'm in control. That's that's a massive deal. So I have a friend of mine who, when he goes into something like YouTube or a business, he looks at, alright, what's the minimum threshold that I wanna get to and how do I get there? And how much money do I need to spend to get there in order to get there quickly? So... And I think that's an interesting framework. That's not how I think, but he's kind of changed my mind on it. If I was sitting at home and I was like, alright, a 100 doors, how can I get there within six months? And and let's say money is no object. What would you do? How would you go and get a 100 doors within six months? [00:27:16] S0: 100 doors in six months would be a big challenge. I'll say that. I would probably allow for like one year to eighteen months.
00:27:16 · Peter Lohmann, Nikolas Hulewsky
[00:27:16] S0: 100 doors in six months would be a big challenge. I'll say that. I would probably allow for like one year to eighteen months. [00:27:24] S1: No hedging, six months. All right. You have six months. What would you do? [00:27:28] S0: If you had to do it in six months and money was no object, you would obviously crank up the online ads to the max. Okay. So you would saturate Google with PPC. There's also a few pay per lead vendors in our space, and you would wanna saturate those as well to make sure you were getting every lead possible from the Internet search world. I would also go to every single possible local meetup, every real estate investor meetup group, every realtor meetup group, every real estate networking event. I mean, there's usually, like, a dozen of these a month. It's just trying to figure out who all's hosting them and where they are and how you can find out about them. So that's the Internet. I would focus a lot on my Google score and my Google business profile. That's a big thing with property management. And so I would have all my friends and family leave me reviews. I would have all of my first customers leave me reviews. You really wanna be at, a 4.2 or higher in that range of your Google score so that you show up high on, the Google Map pack. Yep. I would also invest in an outstanding, you know, website and and hopefully a group that's really, really good at SEO because you ideally want to rank highly organically in Google as well.
00:27:28 · Peter Lohmann, Nikolas Hulewsky
[00:27:28] S0: If you had to do it in six months and money was no object, you would obviously crank up the online ads to the max. Okay. So you would saturate Google with PPC. There's also a few pay per lead vendors in our space, and you would wanna saturate those as well to make sure you were getting every lead possible from the Internet search world. I would also go to every single possible local meetup, every real estate investor meetup group, every realtor meetup group, every real estate networking event. I mean, there's usually, like, a dozen of these a month. It's just trying to figure out who all's hosting them and where they are and how you can find out about them. So that's the Internet. I would focus a lot on my Google score and my Google business profile. That's a big thing with property management. And so I would have all my friends and family leave me reviews. I would have all of my first customers leave me reviews. You really wanna be at, a 4.2 or higher in that range of your Google score so that you show up high on, the Google Map pack. Yep. I would also invest in an outstanding, you know, website and and hopefully a group that's really, really good at SEO because you ideally want to rank highly organically in Google as well. [00:28:42] S1: Alright. So I know you're going to do all those things pounding the pavement With the digital stuff, and I had... I don't know if you know who Buddy Rothmoll is, but he has a Google Business Profile agency and so... [00:28:51] S0: Okay.