How to Avoid Marketing Yourself Out of Business in Real Estate with David Richter

Ever feel like you’re making money in real estate but still feel
broke? In this episode, I sit down with my longtime friend David
Richter from Simple CFO Solutions to tackle one of the most
overlooked yet crucial aspects of running a real estate business:
financial management. David shares insights from his book, Profit
First for Real Estate Investors, and breaks down how to implement
systems that help you stay profitable while scaling your
business. From budgeting for marketing to hiring the right team,
we cover strategies to avoid common pitfalls like over-marketing
or spending yourself out of business. If you want to understand
where your money’s going and how to keep more of it, this episode
is packed with actionable advice you don’t want to miss!





Timeline Summary:


[0:00] - Introduction


[1:22] - How David and I got started in real estate and our
background with wholesaling.


[3:00] - The inspiration behind Profit First for Real Estate
Investors and why financial clarity matters.


[5:38] - Common mistakes in budgeting for marketing and tips to
allocate effectively without overextending.


[10:52] - How to tweak marketing budgets when scaling and the
importance of ROI benchmarks.


[15:10] - Advertising vs. organic marketing: How long to test new
strategies before cutting them off.


[19:20] - The role of Profit First in helping real estate
investors create sustainable financial systems.


[22:10] - Allocating resources for staffing and avoiding the trap
of unsustainable payroll expenses.


[28:15] - Fundamentals of tracking financials and improving
conversion rates in your sales process.


Key Takeaways:


1. Track Every Dollar: Many real estate
investors struggle because they don’t know where their money is
going. Using systems like Profit First can give you clarity and
control over your finances.


2. Budget for Marketing Wisely: Allocate no more
than 30-40% of your revenue to marketing, and ensure you’re
seeing at least a 3–5x return on your investment before scaling.


3. Don’t Overspend on Payroll: Keep payroll
expenses under 35% of your total revenue to avoid overextending
your business, even when hiring staff like lead managers or sales
assistants.


4. Test Marketing Channels for 90 Days: When
trying new advertising strategies, give them at least 90 days to
evaluate effectiveness, but be prepared to pivot if the results
aren’t there.


5. Focus on Conversion Rates: It’s not always
about generating more leads—it’s about converting the leads you
already have. Regularly track and improve your conversion metrics
to maximize ROI.


Links & Resources:


• David Richter’s Book: https://simplecfosolutions.com/bulk/


• Simple CFO Solutions Website: https://simplecfosolutions.com/


Closing Remarks:


Thanks for tuning in! If you found value in this episode, don’t
forget to subscribe, rate, and leave a review. Share it with
friends in the real estate space who could use a little extra
help mastering their financials. Connect with David Richter using
the links above, and take control of your business’s
profitability today. See you next time!