The Best Advice I Never Got About Land Investing w/ Alex Reese

244: In this episode, I sat down in person with Alex Reese from Acrewell, a rising star in the land investing world and an absolute YouTube powerhouse. We talk through his journey from eating peanuts in a CVS to flipping hundreds of land deals, building a media brand, and creating a deep educational product for land buyers.

(Show Notes: REtipster.com/244)

Alex shares the highs, the lows, and the big mindset shifts that got him out of debt and into building real wealth. He also drops a ton of wisdom on soil issues, due diligence, price-per-acre myths, seller psychology, and how YouTube changed the game for him.

If you're into land investing, building a brand, or just want to hear some crazy land deal stories, you’ll get a ton from this one!

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Transcript

0:22

(Transcribed by TurboScribe.ai. Go Unlimited to remove this message.) Before we jump into today's episode, let me ask you this. Are you still managing your land business with spreadsheets, sticky notes, or scattered tools? Well, you need to know about Stride CRM. This is the all-in-one platform built specifically for land investors. Everything from lead capture and automated follow-up to contracts, e-signatures, calendars, social media management, and a lot more. It's like having a full-time assistant that never sleeps, never forgets, never gets sick, and never needs a day off. Check it out at StrideCRM.co and see why investors are switching. Hey, everybody. Welcome to the REtipster podcast. My name is Seth Williams. Today, I have a unique opportunity to interview Alex Reese of AcreWell, which is a amazing YouTube channel. This guy has some super solid videos that I've been watching for the past couple months. When I saw what he was talking about and just the job he was doing, just making amazing content, I was like, you know, do you want to come on the podcast? And he didn't just say yes. He said, Seth, I want to fly out to Grand Rapids and do this thing in person. And I was like, really? Huh? Nobody's ever done that before, but okay, let's do it. And so we're sitting in my backyard right now. He flew here from Philadelphia yesterday. And we're just going to have a little fireside chat, literally. We're just going to hang out and talk land, and talk YouTube, talk about business, life, whatever comes up. So welcome, Alex. Welcome. Well, Seth, good to be on with you. Thanks for this opportunity. Seriously, it's an incredible opportunity for me. As you know, I've been a fan of yours for a long time. I've been watching your videos for years. And that's why with YouTube, it's so powerful. And we were talking about this a little bit, which is you feel like you know someone, even though technically, you've never met. But I feel like I know Seth, I'm sure a lot of the viewers of Ari tips or feel the same way, because you do spend a lot of time with someone in a way when you watch their videos. And so that's why, you know, I felt like when we were talking last night at dinner, I just felt like this was going to happen. And so that's why when you had reached out to me to come on the podcast, you know, my first response was like, Hey, we're doing it in person, man. Hope that's cool. And you're like, yeah, absolutely. Might not have been that forward. But the idea was like, in my head, I kind of felt like this was coming around. And if you hadn't reached out to me to be on your channel, I probably would have reached out to you to be on my channel, because I've been a big fan for a long time. And you're incredibly generous to have me on. So thank you for hosting me. Yeah, absolutely. Yeah, I think the only other time I've done this kind of thing was with Luke Smith back in 2019, when he happened to be in Michigan, and he drove down to see me. And Alex was referencing that interview. He said, Luke did it. How about I do it? So also, I want to ask you, Seth, yeah, I feel like, does anyone tell you that you look taller in person? I hear that. Guys, most of the time, guys, I just want to say for the for the audience, because it's my first time meeting Seth. So for anybody that hasn't met him in person, Seth is taller in person. And I think he's also a little bit more jacked, too. I think I think have you been working out? I've been known to work out from time to time. See, I met Seth at the hotel in my hotel lobby, we were going to dinner last night, he walks in, and I'm 510. I'm like, I'm like average height, or maybe even above average. And I was like, damn. So Seth, I don't know if you get that from anybody else. But how tall are you? Like six foot, six, one, six, well, six to six to see, see, yeah, thrilled to be here. We can kind of go in any number of different ways. I just want to say, first of all, if you guys haven't been to Grand Rapids, wow, I don't know what what to tell you, we're going to put I took a video from the plane as we were landing, because we were coming under the clouds. And as I could see through the sections of the clouds, I could start to see the countryside. If you've never been to Grand Rapids, I can assure you that you've never seen anything like it. When you're flying into Grand Rapids, it is one of the most beautiful rural areas I've ever seen. It was the perfect time of year to the trees. I mean, the trees around here, they're changing color, they're red, they're yellow, it's like the nicest farmland in the world. And I was coming from a flight of people from Philly and that the people behind me in the in the flight were like, wow, we thought that like Chester County was nice, you know, it's like this is like something else. And so that was what everyone was saying. So I have a little video, we'll be looping it on this part of the interview so that you guys can see it. But yeah, it's an incredible place. And I just feel like, you know, this was a long time coming. So again, thanks for having me on. Yeah, man, of course. Maybe we start this from the very beginning. Tell me about who you are, where you're from, like, when you got into the land business, how did you discover it? What were you doing before that? A lot of questions I just do actually. But let's hear about the history of Alex. Yeah, well, so I'll look fast forward to about 10 years ago, I'd always wanted to do my own business. But, you know, when you're in your 20s, and you haven't really been tested in your career, you have confidence, but it's sort of like a schoolyard confidence, because you haven't really been tested. And so the realities of starting your own business are a little bit different from what you've been told on the internet, because you think that you start your company, you get this like, you get your LLC on legal zoom, and there's a bunch of confetti and streamers and like some big cardboard check like, yeah, man, you made it. But really, it's quite the opposite. The work really begins at that point. And a lot of people that get into land myself included come from a place of they just want to make it, they want to be able to build something for themselves, maybe they're working a corporate job, and they make good money, like I did, but it's sort of like golden handcuffs, where the further you get into that opportunity, the more dependent you are on it. And so you want to build something for yourself, and you want to replicate or even exceed hopefully your the income that you made before. So that was the case for me in 2017, I started a business that was like a 1099 distributor for medical devices. So I was a I was a medical device rep, and I had worked, I worked with a couple manufacturers, I was trying to sell these tissue graphs, these expensive surgical tools and stuff like that. And I just thought if I worked hard, that eventually, something would break on the other side, and that I'd get momentum, and I had some commissions coming in, but not really enough to live off of it. And so I figured if I just keep my head down and work, that it would work out. But I didn't have a plan. I had no sense of the timeline, I was living off of credit cards. And by 2017, I was flat broke. So I was commission only sales agent, my own company, but I wasn't making enough money to even pay rent on a small one bedroom in Philly. So what ended up happening is I was about 40k deep in credit card debt. I remember at that time, I was so broke that I did a lot of my grocery shopping at CVS, because I buy those tins of cocktail peanuts. And because it's like the most calories that you can get for if you're broke for like $7 you have you can get like 3000 calories. And I liked I still to this day, occasionally buy those at the market. But I remember I would be at the CVS counter to check out. And I'd have like cocktail peanuts and like water literally. And there would be I would kind of have that poker face I'd be bluffing it's like, yeah, like I definitely have room on my credit card, right? And like, I'd wait like for it to go through it's like, okay, you're good, like chichi, chichi, and then it would print out the extra bucks. And I'd play it cool that then too, because I'd be like, okay, extra bucks. And I'd look it's like, oh, $4. Whoa. What was funny is like, I was at that time, I was like, as far as my career, I was like a six figure sales talent. I had made 100k on a sales job prior to that. But I just went into the 1099 thing early without a plan, a couple months of living off credit cards, you know, and you don't have the money to support that you're kind of on your ass like I was. So then at that point, I started I got a W two job, I was back in medical device sales. And then I started selling life insurance in the evenings. That's a whole separate conversation, too. But eventually fast forward, I get into land, there's a lot of prologue here that's interesting. But when I got into land, it was in 2020, probably largely as a result of your content, I used to watch you every day, I still I still watch your podcast, listen to your podcast, at least once a week, including on the plane on the plane ride over. And 2020 flip in desert squares in Mojave County. And I'll pause there, because that's a starting point for that's familiar for a lot of people. But uh, but yeah, I mean, I got started and five years later, we flipped multiple 100 properties. We have a business now that is more focused on media and education, we can talk about that pivot, but I still I still do land deals, I have land deals in the pipeline now. And so our business has evolved more in terms of education, online education, media, but the land thing that I started five years ago was instrumental in building my skill set to where I am today. Talk about the transition from doing desert squares in Mojave to what you're doing now. So at some point, the idea popped into your head. I'll start a YouTube channel. Yeah, so like, when and why did that happen? Because most people who do YouTube, and especially those who succeed at it, like, it doesn't just happen by accident, like you really want it and you've got to run after it and takes months, sometimes years of just like, you know, floundering and not getting anywhere before you actually kind of hit traction. Yeah, and you actually hit traction pretty soon, like you've got some, what I would call viral videos within less than a year, starting your channel. So yeah, tell me how the YouTube thing came about. Well, when you're a small business owner, as you know, and in land investing is no exception. In fact, it's really, it's the best example of it where you do a good deal, you get paid and at the beginning of your time in land investing, what will happen is you get started, you know, it'll be hard work, but you'll get lucky once or twice, you probably had an experience like that, where you'll, you'll, you'll hit like a $40,000 deal. And the money comes in, and it's like, okay, I'm good at this, right? And then maybe you are, maybe you're not, but then reality sets in. And then when you are, when you have a couple thin months of slow months, if you have payroll, if you're running direct mail, I mean, you could have like, you could easily have 20 K in overhead without without even thinking about it. And when the money doesn't come in, if you're not selling property that month, like you could lose 15, 20 grand quickly, you know, either or months and guys, this is any business. It's not like a land thing. This is like a, this is just like a real world small business thing. And every small business owner knows this. People come into this thing about land where it's like, Oh, I want to make a bunch of money. And that's great. But the thing is, when you get into business, whether it's land, or if you're, if you set up a private practice as a dentist, or if you sell firewood by the side of the road, you have a skill set, or you have a business plan, and you get started. But the majority of businesses won't break even for at least the first year. And I mean, that's typical for if you're if you're lucky, you'll, if you're lucky, you'll lose money for the first six months of any business. And then the next six months after that, you're like kind of breaking even or there's some positive months. And then on the end of the year, if you break even, I mean, you're killing it. And so at the end of that first year, second year, you're like making less money than all your friends. And so you go through a period of time where you are working harder than all your friends who have corporate jobs that work less hard than you and they work for the weekends and they go out, they party. And you're just eating dirt. And you're eating dirt for multiple years. And so if you're doing this thing for money and 10 months in, you're working 65 hours a week and losing money or breaking even and not even enough, you're draining your savings to support the business. The interesting question is, do you really love it? Do you really love what you do? Because do you love what you do enough to stick through that period of time, the valley of despair, which you will encounter? Because it's a psychological phenomenon that happens when you start a business and you have a certain expectation. But like I was saying, the confidence that I had was sort of schoolyard confidence, I had not really been tested. Because as an adult, as a kid, I like abstractly, I was like, oh, I have a degree or all I know this or oh, they paid me this much last year in my sales job. But any gaps in your skill set will be exploited immediately. In the world of business, it's like a mirror in front of you. You will see your flaws up close and personal and high and tight at a level of resolution that you can't possibly ignore. Because if you have holes in your game, if you have holes in your marketing, you'll just lose 18k. And no one cares. So you get through that. And to answer your question about the YouTube thing, you get through that. Actually, most people don't, honestly, because they don't love it enough or because they don't understand the dynamics of it. So they'll quit that opportunity, even though they were six months away from a profitable business. And then they'll just go to the next opportunity and they start the timer over. So that's maybe, I mean, it's an interesting point you're talking about, like, how do you know when you're ready to go out on your own? Because I look at my story, I actually hung onto my job probably a lot longer than I needed to. And when I finally cut the cord, I was more than ready. I never had super thin months when I was starving or anything. But at the same time, I was just very scared to make the leap. So I think there's that too. And honestly, it kind of stunted my business's growth because my job was the bottleneck. And I was just clinging to that for dear life because I felt a sense of safety. But I'm curious, knowing what you know now and the experience you had, like, what would you tell yourself if you could go back to those years? Like, when would you be ready? Do you need to totally replace your income and some with your business before you jump into that full time? It's such a good question. There's a lot of angles to it. 10 years ago, I was, I guess, 24. And let's just even less distant in the past. Eight years ago, I was 26. 2017, this is when I was eating the cocktail peanuts and the living off of extra bucks on the end of a 35k credit card balance, literally. Any business I started at that time would have failed and did fail. So there's a skill set that you can develop in certain types of jobs at the beginning of your career, which will cut your teeth and give you a well-rounded skill set to start a business. Some of those types of jobs are anything in like, sort of like private equity, finance, banking, those like high pressure finance jobs, where they just beat you to sleep with work, and you like sleep under your desk, and you make good money, but you have no life, or you're like living in New York or Chicago, that type of thing. Another one is management consulting, because you kind of learn about how a business works and the mechanics of business. And your 24, 25 year old management consultants that have two years, three years work experience, those are actually pretty well-rounded professionals at that age. The other thing is to work at a startup, to work as an early employee at a company that maybe gets venture capital funding or to work for a local entrepreneur. I think an untapped opportunity is for someone to figure out like, where do I live? And then who are the players in that market? And then how do I link up with one of those players in that market and just like do what they say? And you'll just by osmosis learn all that type of stuff that you need. Now, most people don't have one of those experiences early in their career. And so I think the best way to start is how you started and then really how I started too, which is you started on your evenings and weekends hours and you just start the business while you have a corporate income that's coming in. You use that income to de-risk the business and to make you emotionally insulated from the success and failure of that company. Because there's going to be a lot of failure and there's going to be a lot of times that the biweekly direct deposit is going to be a really critical lifeline for you when the business is started. It also helps to get credit cards and get some credit facilities at local banks. And it gives you that energy of I'm good either way. It gives you that I'm good either way energy. That I'm good either way energy is the energy that you need to be successful anyway in business. And so what happens is that your schedule, your lack of time constrains the time that you can put in the business. But your income and your corporate job is the fuel that allows the business to be viable while you're figuring your stuff out. So I think that's kind of the main idea that I would say. Yeah, totally. So tell me about your first 12 months in the land business. It sounds like you were doing desert squares. It sounds like you were making not as much from land as you were from your job. No, not at all. So when did you start exceeding your income and how did you do that? Was it just doing more volume of the little stuff or did you fundamentally switch to different types of properties? Yeah, so I started with the desert squares and then I did several of them. I still have a land contract. We were talking about that last night. That was back in the day where it's all about passive income. Remember that? That was one of the eras of land investing when I got started. And basically, I was working at a startup and I was living with the early employees and even the co-founders of this healthcare startup that I was working at. We had raised a Series A or Series B financing. And so the company had a ton of money. And so I had sort of gone without a salary during the beginning of the pandemic in exchange for stock options in a company where we just had to survive. All the other businesses at that time, it was unclear what was going to happen after when this thing was going to end. I had lived in a house with five other people. And at that house, we were just working all the time. It wasn't a 40-hour a week thing. At a startup, you're working 50, 55, 60 hours. We didn't really have a life. It was the pandemic. So the land thing started for me. I was sending mail. I didn't have traveling mailboxes even. I didn't have one of the remote mailboxes. I would send mail campaigns for desert squares in Arizona for like in Meadview in Mojave County. Meadview, right? Have you ever done deals there? No. Okay. So it's right up the road from like Lake Havasu City, kind of right near the Colorado River, not far from the road that might be like 83 that goes into Las Vegas, very rural, like desert, just the epitome of desert squares. But there is a community there. And so I was sending mail campaigns where the actual mail responses would come back into the shared mailbox of this suburban home in California that I was living in with five roommates who I was also working 60 hours a week in a company with. And I would just get these handwritten letters from people I didn't even know. They were signed purchase agreements. So I would weirdly go out and check the mail every morning. I was like, hey, I got a new mail. I was like, Alex, you're really interested in this mail. It's like I'm expecting some correspondence. So I did that and did some flips, self-closed on a couple of those early flips. And then really the first cash deal, the cash flip that I did, I sent mail into a subdivision in a town called Boiling Spring Lakes, North Carolina. Do you know that town? It's in Brunswick County, and it's not far from the coast. It's right outside Wilmington. That's a town where I saw these big subdivisions. I would send mail back and I got these responses from my letter campaign in these subdivisions where it was all empty. There was roads and there might've been power lines, but it was like being reclaimed by nature. And yet, quarter mile down the road in the same town, there were these booming subdivisions where like you couldn't buy and sell property fast enough. You couldn't build homes fast enough. And then I saw these big blank grids in the edge of the town and I was like, why are there no homes here? There's so much land here. And that's when I learned about soil, because that town had promised or made a commitment to install an underground sewer line. They wanted to have municipal sewer. They never did that. And so a lot of those lots that came back into that first mail campaign were property that had an assessed value of 20 grand. I'm looking at a signed purchase agreement for like $4,200. And I'm thinking, damn, how is this not going to work out? And so what I found was that it didn't perk. You couldn't build. There's no sewer and there's no septic either. It's basically wetlands. But then a better property on a better road in the town, I finally got my first septic permit done on that property. I bought it for... I don't have the numbers in front of me, but it would have been something like bought it for $4,500. I probably had $6K in it by the time I closed it. Then I sold it at like $16,500 or $17,500, where on a cash flip I made like $9,000. And then I was off to the races. And then I realized it's these cash flips where you're going to make your margin. Your payback period is going to be better. And so I started in that section in North Carolina. And a lot of people think I live down there because I've done so many deals there that everyone's like, oh, you're local or where are you? I live in North Carolina too. And it was this arbitrary thing of I just started sending mail in nearby local areas. And as I started doing that more, it reinforced that pattern because you get certain economies with local... If you invest in a local market, it's like real estate agents, soil scientists, surveyors, all these types of professionals that you're going to need on a recurring basis. If you can market in the same local areas, it ends up helping you. And to be able to do these deals at volume, because the specialized vendors that you need for due diligence that have the skillset or the local market expertise are there and you know who they are. And they pick up when you call because they know that there's business there. Let's talk a little about limiting beliefs. Okay. Have you ever had limiting beliefs? Yeah, I'm sure I still do. Yeah. So how do you overcome those? Because I know this is a thing because I certainly have them as well, probably more than the average person does. And I hear this whole thing about like, that's a limiting belief. You just need to overcome it. Anything's possible. But the truth is not everything is possible. There is truth to some limiting beliefs. And I never really know where the line is, but I probably do draw it way too low. But tell me about your experience with that. What limiting beliefs did you have? How were you punished for those? How did you overcome those? Let's get into that. The biggest thing when you start with land is why would anyone sell their property for less than it's truly worth? That's the biggest thing. A lot of our audience on our main channel, on YouTube, they stay like they're not necessarily land investors. Now we probably have 20 or 30% that are. But a lot of people don't get it is how if your land is worth $50,000, why in the world would you ever sell it for less than that? And that's one of the things that they don't understand. And so one of the limiting beliefs is that you can't buy land for much lower than the property would sell on the open market. And you absolutely can. We do it all the time. And it's a very well-documented fact that you can. Understanding why enables you to be confident when you talk to these sellers. Because when I was talking a little bit earlier about the sort of I'm good either way energy, when you have the income coming in and you start this land business or a business on the side as you get started, you know that you don't need that deal. You don't need that deal to work for you to pay the rent. And so what started to happen with me is I started to really be open and honest with the seller. Because when I would have these sellers, I would be busy with work. I'd be getting paid a salary. I'd have other deals, other real estate deals coming in. And I started talking to these sellers from a place of total ambivalence. They were like, hey, how do I know it's this? Or how do I know it's that? Or whatever. And my whole thing was like, look, the land is worth more than I can afford to pay you. Because if I buy it, I have to make a profit. And maybe I do, maybe I don't. But if you wanted to get top dollar, I can connect you to the local agent that can help you. And to get it marketed, you'll need aerial photos. You'll want to get the soil work done. It'll cost about $1,000. You want to pull a septic permit. That way the buyer doesn't negotiate on that and you can sell it faster. Then you want to list it. When you list it, you're going to have to pay 10% commission to get the right agent on the listing. And then when you do that, you're going to have to wait like four or five months or more to sell it. And then if it sells, maybe it sells at that price, maybe it sells lower than whatever price it sells at. Then take 10% off of that and then wait six months to a year. And then you might sell for more. Or I'll give you $60,000 today. And so when you talk to people and you're just clear, it's like, here's the fork in the road. I'm good either way. I don't need this. Here's what your option is, is option A, option B. And knowing that you can't control what they say. You cannot control the seller because a motivated seller is going to want to sell that land to you at whatever your highest and best offer is that's actually real. And if a seller wants to get a good cash number on a piece of land that's worth $120,000, if they want to sell it to you at $65,000 cash, they will. You can't control that. All you can do is tell them, here's the best offer I can make. And then if that doesn't work, I totally understand. And let the chips fall. And when you're ambivalent, that's when they trust you. That's when the best deals come in. It kind of reminds me of Logan Fulmer in some of the messy title deals that he does. It's a similar negotiating thing where when he's talking with people and it makes a really low offer, he talks about, yeah, if you want to go clean this title up yourself, what I'm going to have to do is I got to do this, this, going to talk to this attorney, it's going to take me this amount of time. Got to contact all seven relatives, just really laying out what a huge hassle this is. And they're probably not going to want to do it anyway. It almost kind of like they make their own decision at that point, but they have to be informed about the laundry list of items, the reality check of what it really takes to sell this thing for what they want. Exactly. So doing that. And also, it's really in powerful words, I might tattoo this on my forehead. It's just the words, I don't need this. I don't need it. Just taking that stance and actually believing it. Oh, knowing it. Yeah. Yeah. And I mean, it's a similar thing when you're, we talked about before we started recording, you're like negotiation to buy a car at a discount or something. You have to be ready to walk away and start walking away. Start walking away. Walk out the door if you have to. I've heard Dave Ramsey talk about this kind of a different thing, but he was talking to somebody who they were interviewing for a job and they didn't know if they should take it. And he was saying, in any negotiation, the three things you want are time, information, and options. Yeah. Like just, if you have that, you are definitely in a position of power. And as a land investor or any business person working out a deal, just remember that. Like give yourself time, information, and options, and you can have super leverage in a negotiation. And whenever you need something from someone, they feel it. And what happens is there's a psychological dynamic of this where even with your friends and family, when you're trying to get your spouse, your significant other, your friend to do something and you're forcing it, see, people know, we know that we're free to do whatever we want. And so what happens is that when the counterparty, the person you're talking to is trying to enforce a decision on your part, you can feel it. And it's constraining your freedom of choice and your ability to do what's best for you. And so when you feel that pressure coming in, you naturally push back against it. And that's why when people are attached to an outcome, a seller making a decision, a property, a deal going well, this thing or that thing, when that attachment starts to stick and you feel it and you're chasing it, you naturally create resistance to the things that you actually want to have happen. So tell me about what your land business looks like today versus what it looked like a year ago or two years ago. What direction has it gone and why has it gone in that direction? Yeah, so basically a good question. As I was getting better at flipping property, at flipping land, I was making less money. We talked about this at dinner last night. And my skills were going like this and my income was going like that. And it's a marketplace dynamic. And guys, understand all businesses work like this. All industries work like this. There's always ebbs and flows in a business. But I want to go back to the, and I'm going to answer that and tie it back to a question that you asked. I didn't answer like a couple minutes back, which is how I got into YouTube. And so what happens is as a business,