EP. 25 // $3.5 Million in Annual Revenue at 25 Years Old w/ The Deraaff Brothers
On today’s episode we’re seeing double with the tag team of twin brothers Austin and Jake Deraaf, out of Tarrytown in upstate NY. The brothers are most notably the President and Vice President of Raven3 Homebuyers, a wholesale company in the Hudson Valley, but have founded myriad companies in the real estate space. In this episode we get into the meat of how the brothers source deals through SMS and cold calling, the importance of omnipresence in marketing, and how dropping out of college fueled them to build their multi-million real estate empire (and eventually employ their parents!)
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Key Points from This Episode:
Austin and Jake are two twin brothers who have been in real estate for 5 years. They were college dropouts who started real estate from a course that specified you can start with no money down and no credit.
The brothers’ parents wanted him to stay in college; they said if they dropped out they would have to move out of the house. The brothers immediately left in order to start their own business. Their parents now work for them!
The two have a rule of not taking the advice of anyone who doesn’t have what they want; even though their parents want what’s best for them, it’s important they don’t take their advice! “If you aren’t a millionaire please don’t give me financial advice!”
The Deraff’s business consists of wholesaling, and they’ve since moved on to flipping, construction, an Airbnb investment company, and Hudson Valley Investments. Apartments, Airbnb, and Assignments. They’re looking to scale their companies with investors.
First year of business was a grind, they made $275,000 in net gains in the final 3 months of the year.
The advice the brothers have is starting with ONE channel and absolutely mastering it. If you can scale one, you can scale ten. Whatever the marketing channel is should be your focus. David agrees; he started with too many; when he downsized to focusing on one channel, cold calling, he found success.
The brother’s focus on SMS. It has the highest ROI and gets the biggest profits. Secondly, RBMs, and third is cold calling.
For SMS they consistently change numbers, 50 new numbers every week! This stops them from getting flagged. With the numbers changing and constantly changing the messaging, they get a 1 to 2% response rate. And when they do get a response, they’re hot leads! They target messaging per the circumstance.
In 2022,the brothers advanced from NY to Connecticut. The brothers’ wholesale company is on target to net 3.5 million. 4 to 500,000 a month on the assignment side.
The brothers skiptrace their numbers through LeadSherpa.
The Brother’s secret sauce is “omnipresence.” Their business and marketing is so multifaceted that one way or another, it’s going to make it to a closed deal. Every channel is open and flowing and it’s that consistency that makes them successful. Although they specify that it’s important to build that up by
The brothers do EVERY offer in person, no virtual appointments! They become friends and help find solutions for each seller. They go quality over quantity.
Become an expert in your market; Austin knows every street in Westchester county! Since they rent, flip, construct, novate etc. they know every number they need to know. They can put deals together one way or another.
The brother’s say their youth helps with apartment deals, since apartment owners were young investors at one point themselves! Home owners may want more mature operators but they consider their youth an advantage in the apartment space.
For highly motivated leads, they have multiple VA cold callers and their full acquisitions team. There are three lead managers for direct follow up. Acquisition Managers are cold calling. If they aren’t on an appointment they’re on the phones.
They’re starting their own fund in order to secure capital. Commercial debt, 85% financing, 5-6% interest rates. Value add only in order to take out their capital and secure long term debt. 65/35 split, 6% preferred rate, and a lot of long term holds in solid markets with potential for rent increase. Minimum 20% cash on cash for any deal they invest in.
The brothers have implemented David’s seller carryback option and it’s changed the game! No interest, 3 year deferment.
The best advice they have is to take advice from qualified people and stay consistent. If you keep your goals in mind you can take singular steps and show up every day, and one day you’ll reach that goal. Pay for results! Just by joining Collective Genius they doubled their business.
Relevant Links from Today’s Episode:
ABOUT AUSTIN & JAKE DERAAFF
Austin and Jake Deraaf are the President & Vice President of Raven3 Homebuyers out of Tarrytown, NY. After dropping out of college, the twin brothers went into real estate. However, they didn’t invest in real estate through a Real Estate Investment Trust (REIT) as most kids their age would. They got into real estate wholesaling. It took Jake and Austin a long time before they closed their first deal, but the twins were persistent, and finally, after seven months, they closed their first deal. That confidence springboarded them into action, and they’ve since closed hundreds of deals, before starting CloserUniversity, A Real Estate Investment Training course where Jake, Austin, and Tyler teach you the methods they’ve used to close over $3,000,000 worth of deals.
