George McCleary: 0:00

Ladies and gentlemen, we have Scott Dalinger, he's gonna do the 40 degree cold plunge. How do you feel, buddy?

Scott Dalinger: 0:05

I'm scared as shitless right now. I did this once before and it was not fun.

George McCleary: 0:09

Oh, it's never it's never fun that but that's not the point. The point is to overcome. One fell swoop, buddy. And he goes, he's in there.

Scott Dalinger: 0:25

What's the trick to this? Just tell yourself that you're warm?

George McCleary: 0:29

Welcome to frozen millionaires The show where we submerge successful people in ice cold water. Then sit them down to talk about how they've achieved success. I'm your host George McCleary. And I have a pension for ambition for entrepreneurship. And for watching my friends suffer in cold water. No tech CEOs or Wall Street Titans here. These are the Self Made Millionaires next door and they're fresh out of the cold plunge telling their stories. What's up friends and welcome to episode two of frozen millionaires. Taking that cold plunge like a man was real estate wholesaler Scott Dalinger. Scott is my guest today and although he's only been in real estate for a few years, Scott has built a really impressive wholesaling business, as well as a real estate portfolio chock full of income producing assets. Today, we talk about how he got his start doing sales internationally how this experience helped him excel at real estate investment, and how he's built a business that allows him to travel the world, seek grand adventures, and really take advantage of the freedom that comes with financial independence. Let's get into it with our latest frozen millionaire Scott Dalinger. In the studio today, we have a good friend of mine, Scott Dalinger. It's a real treat to have you here, buddy. Thanks for coming.

Scott Dalinger: 1:42

Yeah, thank you for inviting me.

George McCleary: 1:44

Yeah. So are you feeling tingly? Like you feel like you want to run through a wall? Are you uh what do you think of the plunge?

Scott Dalinger: 1:50

It's really difficult to do at least in the beginning. I don't know if it gets easier, but I feel I feel like peak awakeness

George McCleary: 1:57

Peak awakeness. That's a great way of putting it. I love it. So do you see yourself doing it again?

Scott Dalinger: 2:03

Probably every time I come over to your house. I don't know that I'm ready to put myself through the suffering every day yet and and buy one like the last guest but yeah, but we'll see every time I come here. I'm gonna be jumping in

George McCleary: 2:15

That's right. Yeah, no Dustin Miller, the that thing. previous guest, our first guest the guinea pig, he jumped into the cold plunge and had a hilarious reaction. So I'm going to be uploading that sooner or later. So if you haven't seen it, by the time you're listening to this should be posted. Go look at Dustin Miller, Dustin Miller's reaction to the cold plunge. It's amazing. So uh so Scott, now that you got your adrenaline pumping, and your blood vessels are, you know, full, full of energy and blood, let's talk about your business. Because you are one of the one of the business people I'm just gonna come out and say it that I like I most admire in our in our little circle, because just from what you've built in such a short amount of time is really nothing short of remarkable. Started off doing something completely unrelated to real estate, and then has since then built a real estate empire just in a few short years. Why don't you just take me back to the beginning and pretend we've never met and tell me what you've done from the jump or I guess maybe even before real estate.

Scott Dalinger: 3:13

Sure. Well, I wouldn't call it a built an empire yet, but we're working at it. Before real estate I was in the corporate world, George I was doing sales in North America for a Belgian owned company with a US headquarters out of Knoxville working in Southern California. Working from home in Southern California.

George McCleary: 3:31

That's right, you're so cowboy.

Scott Dalinger: 3:32

That's right. So that job was I would basically fly all over the United States and meet with customers in the transportation industry and sell them our high temperature, high quality insulation products that goes around jet engines and fire protection products that go inside of trains and I really enjoyed the job. I love the travel. I had a great boss and a great company to work for. I'd go to Belgium from time to times and it's something that that I could have continued to do.

George McCleary: 4:01

But this is jet engine insulation that you're that you're selling.

Scott Dalinger: 4:04

Yes.

George McCleary: 4:05

What a niche product.

Scott Dalinger: 4:06

Yes, very niche product, high cost, very specialty product.

George McCleary: 4:10

Okay, is this hard to sell? Is this easy to sell? Did you have to be an ice to Eskimos salesman or there's this thing flying off the shelves? Like, you know, like..

Scott Dalinger: 4:18

Yeah, not flying off the shelves. These are long sales cycles. You're basically trying to get Specht into the engine. So there's like military companies, or let's say manufacturers that would make engines for different military applications for you know, other products for defense companies. And then you know, your regular air buses and Boeing's that you sit on that high temperature insulation is inside of them. So we would work with there, several rungs down the line get and get our product spec in.

George McCleary: 4:49

Right.

Scott Dalinger: 4:50

So basically what the engineers which was a neat part of the sales cycle because we didn't have to worry about purchasing we didn't have to worry about price. We're working with the engineers so on them how our product is the best. They would spec it in and purchasing would have to buy it, they would have no choice.

George McCleary: 5:05

There you go. I love it, they're forced to buy. So that taught and so that taught you sales because ultimately what you got into in real estate was wholesaling, which essentially is like a sales job wouldn't you say?

Scott Dalinger: 5:16

Yeah, wholesaling is sales, it's not real estate. And I had other sales jobs before that. But I've always been in sales leading up to real estate. So I left that company in that industry because my my income was capped was a European company no matter how much I sold, they're always going to cap how much I was allowed to earn.

George McCleary: 5:35

Oh, note to CEOs down there never kept compensation. Your best people will leave.

Scott Dalinger: 5:40

Never cap Scott Dalinger.

George McCleary: 5:42

Never cap Scott Dalinger. Yeah. So you're at you're in sales, and you're crushing it. But you have an MBA, don't you?

Scott Dalinger: 5:47

I don't have an MBA.

George McCleary: 5:48

Didn't you go to Oregon?

Scott Dalinger: 5:49

I went, business school.

George McCleary: 5:50

Oh okay, undergrad business school.

Scott Dalinger: 5:52

Undergrad business school.

George McCleary: 5:52

Yeah, shoutout though. I also have an undergrad business... Yeah, Go Ducks! Go Eagles, I went to Emory, but

Scott Dalinger: 5:55

Go Ducks! I did go to Oregon for one year, so still Go Ducks. So my income was capped. I'm like, you know, I want to earn more money. I'm not earning enough to ever buy a place in southern California. So let's figure out how to regular people get rich or at least make a lot of money in a short period of time.

George McCleary: 6:13

So you just Googled how to how to regular people get rich. And ya know that actually, that really sums up real estate and should be the official real estate slogan.

Scott Dalinger: 6:20

Exactly.

George McCleary: 6:22

So you look up how to get rich real estate. And so, you know, that's kind of the natural progression kind of wholesaling is sort of like the bedrock, under which a lot of real estate investors get their start.

Scott Dalinger: 6:32

Right. Yeah, my parents had some rental properties. And they turned me on to the bigger pockets podcast. So I listened to that, and just sort of like really binged it, many, many episodes of a very short period of time. And I heard the wholesalers and I thought that was really cool, because I was negotiating in my job for, you know, $10,000 raise or like bonus increment. And meanwhile, there's some wholesaler goes on, like, yeah, I found this deal. And then, you know, I made 15 grand, or I made 20 grand. And I said to myself, Wow, that's like, you know, a 10 or 10% increase in salary 50% increase in salary. That's, that's huge. And then how much debt? Can I pay down with that? Because I still had student loans. So then there's other wholesalers that go on that are earning that every single month. I said, What if I could do that every month? What if I could earn 30 grand a month doing doing this wholesaling thing. So all the different people that went on the podcast on bigger pockets, I was really drawn to the wholesalers, because just the speed with which they can make large amounts of money compared to the rental property guys, that would say, Well, I bought this house, I grinded every day after work until midnight, and at the end, we we did a brrrr, and then I have$300 a month cash flow. I'm doing the math. Well, how many, how many of those do you need to do to get 10k a month to live off of? And how long is that going to take? I said, that's gonna take, that's going to take way too long. So that's why I chose wholesale.

George McCleary: 7:58

So you so you're listening to bigger pockets, your mind is racing, you're like, alright, I need I need to do this. Do you buy a book? Do you or do you just head start calling people up? What do you do?

Scott Dalinger: 8:09

Yeah, the first thing that I did was I called up one of the guys that I heard Elliott Smith, he was he's out of like, Tri Cities, Washington. So I called him up said, hey, I was super inspired by your interview on bigger pockets. I'm going to be going out that way with my day job could we meet? And so Elliot was gracious enough to spend a few hours with me when I flew out that way, he answered all my questions. He gave me some advice. He brought me around some of his flips and rentals that he was doing,

George McCleary: 8:37

Just out of the goodness of his heart.

Scott Dalinger: 8:39

Out of the goodness of his heart, but that really made it real for me, because it was like meeting a guy that I put on a pedestal at that time.

George McCleary: 8:46

Oh yeah.

Scott Dalinger: 8:46

And heard him on a podcast and there he was in the flesh, like actually doing this thing that I aspired to do. Then I tried to do it on my own just through YouTube. I got some letter campaigns sent it out, like no results was horrible.

George McCleary: 8:59

Is this in Southern California?

Scott Dalinger: 9:01

Southern California.

George McCleary: 9:01

Okay, yeah, cuz down there, I at least I get the impression that things are pretty saturated and competitive, just due to the high price points and

Scott Dalinger: 9:09

Everywhere is competitive in the United States, I'd say but down there's a whole different beast, and I never figured it out.

George McCleary: 9:16

Yeah.

Scott Dalinger: 9:16

But my next step was I bought a course called wholesaling, Inc. and that course was very action oriented. It was not about education, it was like, this is step one, this is step two, do what we say even if you disagree with it, just do it. And if they had a cadence, you know, every so every few days or is the next step in the lesson, we would have to go do something. So I just did all that and then built the foundations of my business. I still hadn't done any deals in Southern California, but I had the fundamentals in place and at least the basic processes in place. So I'd say like, that's how I really learned.

George McCleary: 9:52

Perfect! Okay, so you get so you get basically like a coaching course, and you follow it to a tee and but but you're still in SoCal. And you haven't quite cracked the code or have you moved to Portland by that point?

Scott Dalinger: 10:03

Still in SoCal hadn't cracked the code and I was at it for a year. And that took I'd say, like, one thing that I did that I read it everything, too is I just stuck with it. And I made the decision that I that I know that this works, because I hear people on podcast, it's not working here. So I need to change something and figure it out. But for a year, we were dumping my wife's paycheck into direct mail marketing.

George McCleary: 10:27

Oh, wow.

Scott Dalinger: 10:28

With, with no return on that.

George McCleary: 10:30

Right.

Scott Dalinger: 10:30

That took a lot of faith to continue to do that week after week. Ultimately, we said, okay, it's not working here. Let's pick a new market and just test it. So I had some family, my sister and my mom moved up here to Portland. And we started sending direct mail up to Portland,

George McCleary: 10:46

And you'd gone to school in Eugene, so you had some familiar.

Scott Dalinger: 10:48

Yeah, exactly, yup. And I started also to cold call in Portland and between those two things, I started to get some evidence that it would actually work here because people would call me off in my direct mail and say, okay, I have a house and I want to sell, and I got some good leads on the telephone. And based off of that alone, we made the decision, my wife and I to move up here to Portland.

George McCleary: 11:11

See, describe your first deal. So some of the phone rings or

Scott Dalinger: 11:16

The first deal was a cold call to Alison Lierman was her name.

George McCleary: 11:21

Oh okay. Shoutout to Allison.

Scott Dalinger: 11:22

162nd Dartmouth, in Gladstone. Yeah, Gladstone.

George McCleary: 11:22

Love it. Go, mom. And I cold called her and said, hey, I want to know if you consider an offer on your property. She said, well, I hadn't really thought of it but yeah, my husband passed away and we're still in this house and the house has some issues and would be kind of nice to get out of here. So I said, okay, well, let me come by actually, I was still in Southern California. So I said, let me send someone to go take pictures of the house, and then we'll be able to make you an offer. So I sent my mom who was already up here to Allison's house. So my mom goes there and she builds a lot of rapport. I sent my mom with a contract the she looked at the whole house, and she called me we discussed offer price. And right there, my mom began negotiating with her and trying to close that deal.

Scott Dalinger: 12:13

Yeah. So we were, you know, she was going back and forth on price and negotiating and got very, very close, like one yard line. And ultimately, the lady needed time to think about it. We didn't get the deal that day. But I knew that we were so close, so I continued to call her and follow up with her. She never answered any of my calls or text messages after that point, or my mom's. So two or three months later, once I moved up here, when I was on that side of town is drove over to her house and door knocked her.

George McCleary: 12:42

Oh, really.

Scott Dalinger: 12:43

I told her who I was she let me in. And I sat in her living room for like two hours. And just overcame objection after objection after objection. And I remember

George McCleary: 12:53

Wow.

Scott Dalinger: 12:53

her saying, well, you know, I, I want to sell it. And you know, I'd love to do this with you, but this so she throw some objection at me.

George McCleary: 13:02

Yeah. What are some examples of those objections? Because that's a big thing in sales is overcoming objections, doing doing so gracefully and not being salesy or, you know.

Scott Dalinger: 13:12

Yeah. So she would say, well, the price is too low. And then I'd have to overcome that objection. And I was really trying to stay low because I wanted to make I want to in wholesaling, you have to lock it up low enough so that you can mark it up and still, the cash buyer makes money, I said, well, I can't come up on price, but what

George McCleary: 13:28

Right? if I was able to, what if I was able to just let you leave everything in the house with would that help you out? Okay, well, that would help me out a bit. Okay, well, what if you didn't have to fix anything? Well, what if you were able to stay in the house, maybe like, another month after we closed that way, you have some money, you could go rent the place or you could go buy another place. Right.

Scott Dalinger: 13:54

And so we we kind of like nailed down that the price was going to be okay, throwing in all those things, then it was, well, I want to do this but I'm gonna need time to find a place you know, the next house I want to buy because we want to buy a bigger house here in Gladstone. And I don't know how long it's gonna take. It could be right away. It could be six months. So then it was more what ifs. Well, what if we can do the contract today and then give you time? What if we did the contract today and let you again, let you stay in the house for a month? It's okay to repeat things. You know, sometimes we just repeat our same objection handle instead of say it a different way.

George McCleary: 14:28

Yeah, yeah.

Scott Dalinger: 14:29

But you just, when you're in that moment, you need something to stay in the game.

George McCleary: 14:33

Totally.

Scott Dalinger: 14:33

So I would give the same sometimes the same sometimes different objection handles to her. So she needed time to find a place that was her big one. And we said that you can let's do the contract today. And we'll we'll push the closing date out. And if you find something sooner, then we'll bring the closing date in. So that that worked for her than the last one. The big one was okay, I still really need to think about it. And like, Allison, we've talked about everything that you said that you wanted. There's something else that you're not telling me. What is it?

George McCleary: 15:08

Ah, so you had to fish out a piece of information.

Scott Dalinger: 15:10

Yeah. If someone's not doing a deal with you, and you know that you're close, and you know that they want to, there's something else and the best thing to do is just ask. I said, what is it Allison that you're not telling me? And she's, uh, well, there's someone that I know, I have a friend that that he said that he wanted to buy this house. So I just want to give him the opportunity before I sign with you just, you know, out of respect for our friendship to let him at least come in here and see if he's actually going to buy it. I said, okay, hey, I totally understand that. That's great of you to be so loyal. Let's do this. You know, we have everything in place. I'm here right now. Let's just do the paperwork today. Can you get, can you get him here over the weekend? She said yes. I said, okay. Bring him by over the weekend and if you call me on Monday and say, Scott, he wants to buy the house. I want to sell it to him. I'll tear up the contract. She thought about it for like, seemed like an eternity. But after probably about 10 seconds. She said

George McCleary: 16:09

The longest 10 seconds of your wholesale career up till then?

Scott Dalinger: 16:12

Yes. She said okay. And I'm like, alright, well, I got some paperwork in my car. Why don't I go grab that? She's like, okay,

George McCleary: 16:22

Great!

Scott Dalinger: 16:23

The walk to my car and I remember the walk to the car, like, I hope she doesn't change her mind. I hope she doesn't change her mind.

George McCleary: 16:28

Yeah.

Scott Dalinger: 16:28

and you know that this is gonna be life

George McCleary: 16:28

Lock the door.

Scott Dalinger: 16:28

And now I've done it so many times, but that first time was like, you're like shaking, it was so intense changing. So I got the paperwork, and we filled it all out. And I then wholesale that deal, we made 52,000 on it.

George McCleary: 16:44

52k on your first wholesale deal. That's remarkable.

Scott Dalinger: 16:48

And I gave notice to my job.

George McCleary: 16:49

Oh my God!

Scott Dalinger: 16:50

That was it.

George McCleary: 16:51

Right then and there.

Scott Dalinger: 16:51

Yeah.

George McCleary: 16:52

Wow. How quickly did did she move out where you were able to close?

Scott Dalinger: 16:55

So we did a 30 day move out after closing, and the cash buyer closed on it gave her 30 days. She took a little bit more time, I think maybe another week?

George McCleary: 17:06

Did you do an escrow hold back on there?

Scott Dalinger: 17:08

No, I didn't know what that was yet.

George McCleary: 17:09

Yeah, I was gonna say because that's a little bit more advanced.

Scott Dalinger: 17:12

This is also pre COVID. But so, you know, things are more difficult in Oregon, but not to the extent that they are today but no escrow hold back.

George McCleary: 17:20

Wow. That's great. So you made 52k On that first one. And so then you're still down in SoCal. So you're doing this all but

Scott Dalinger: 17:27

By that point, I had moved up here.

George McCleary: 17:28

Okay, got it. Okay, so then so then you're off to the races. But you,

Scott Dalinger: 17:32

I was off to the races and it was direct mail and then that first year is just insane. I got a bunch of deals like that on a short period of time.

George McCleary: 17:39

So you so the main marketing channels for wholesaling, I mean, you hear about the direct mail, the cold calling all this stuff, I guess I'm gonna fast forward real quick to kind of the modern day wholesaling, because word has gotten now. It's all over TikTok, it's all over social media, like hey, you can make money wholesaling. And it's no secret that you know, all these different marketing channels like cold like cold calling, direct mail, text, messaging, all that stuff. Everybody in their mom is doing them now. And I'm hearing a lot about how these are all really saturated. They're not working as well anymore. They do work, but maybe not as well. What marketing channels are you seeing trending upwards? And what marketing channels are you seeing trending downwards?

Scott Dalinger: 18:22

It's an interesting question, because you talk to one, you have your own experiences, and you're like, oh, cold calling doesn't work anymore. And then you attend a conference and someone's like, I made all this money just from cold calling last year. So it's I think it really varies by the person and their operation and their inclinations, maybe the market. But what's not working for me anymore is cold calling

George McCleary: 18:43

Right?

Scott Dalinger: 18:44

Yeah, we've, that's what we've always done. What, what is working cold calling is when we're scaling the backside outsourced it to people in other countries with like, a lot of callers and that's just really stopped working. But when we jump on the phones ourselves, we are getting good quality leads. So cold calling, dialing back, like having it smaller is working, the websites working. That's something I had to start four years ago.

George McCleary: 19:12

That's with SEO, right?

Scott Dalinger: 19:13

SEO, yeah. Back in the beginning of 2020. We started SEO on our website so that's finally getting track and we're getting a good lead flow. PPC is working. PPC is very, very expensive, but it's guaranteed leads and high quality leads.

George McCleary: 19:27

Didn't you meet a guy at a conference one time that did nothing but PPC and spent like 50k a month on it or something and was absolutely crushing it?

Scott Dalinger: 19:35

Yeah, just a couple months ago. It's Ben Toeff out of Miami. I think his handle is America's top

George McCleary: 19:39

Yeah. wholesaler. So I mean, he's doing hopefully this isn't proprietary, but I think he's pending like, like last year like 15k a day. Oh, wow. That's a lot.

Scott Dalinger: 19:52

on PPC. It was a lot. It was like 10 or 15k a day. And he was no it's probably too much. It's probably like 5k a day

George McCleary: 20:00

Still though.

Scott Dalinger: 20:01

Yeah.

George McCleary: 20:01

That's a lot.

Scott Dalinger: 20:01

That's a lot. I mean, the stakes are high. You gotta be converting those. But he was doing a nationwide and also like really heavy in select markets and runs his whole business off of that and does great.

George McCleary: 20:11

Wow, good for him. Very cool. So yeah, so that so cold calling, I'm not surprised to hear that that's kind of trended downward because I remember while I was doing that several years ago and getting great results, and it's been kind of a slow, steady trickle out of downward. But one thing that I've done recently is I've been I've been calling on properties myself, you know, stay sharp, and I've been doing different, different asset types that are a little bit bigger if they want, they kind of want. I'm getting people that want to talk to the principal, essentially, like right off the bat, I am actually getting decent results in decent conversations when it's just me like 10x easily what I'm getting with

Scott Dalinger: 20:46

Yeah.

George McCleary: 20:46

offshore cold caller. And so that's just goes to show there's really no substitute for you know, just picking up the shovel yourself some time. It's just not

Scott Dalinger: 20:56

Yeah.

George McCleary: 20:56

quite as manageable from like, from like a scaling standpoint, because there's only so much time that you have and which kind of brings me to the next part is when you said, we've been getting results your team has grown. It's not just you anymore. You've got some other people that describe your back then was just you describe how you ramped up.

Scott Dalinger: 21:15

Sure. So in the beginning, it was just me and my wife. So my wife, Alejandra is an integral part of our team

George McCleary: 21:21

Shoutout to Alejandra.

Scott Dalinger: 21:22

Yeah. And I really realized probably over the last year that I there's no way I could do what I do without her. And and of course, the team that I have today, which I'll explain what that looks like. We added a driver. So in the beginning, I put Alejandra on driving for driving for dollars, then we would skip trace, I would call them we had mailed them letters, then we hired another driver. We lost that guy. Then we look for another driver which was Dillan and who currently works with me. Dillon was crushing it with driving, he'd hit every goal, then we put him on cold calling, he crushed cold calling, like, hey, we want to do texting, Dylan figured out texting started texting, we got great leads. And then we put him in acquisitions. And he's been an acquisitions ever since. And now he's Sales Manager for us. And then 2021, we added a second Acquisition Manager and that person no longer works with us, but we have another Acquisition Manager now Taylor, and Taylor is doing awesome. So yeah, we did, I did really good by myself. But it's been more gratifying to grow a team. And because the results together with the team is far beyond anything that I was able to do or would be able to do by myself.

George McCleary: 22:31

Totally.

Scott Dalinger: 22:31

And those guys are great. And then Shali is my VA in the Philippines. You know, I think VA doesn't give full respect to what she does. Because she does so much for us. She's my assistant. But also she hold calls, she manages our cold callers. She does KPI reports for us. And basically any random task or like new software that we need to add, I'll say, hey, we're going to start using the software, get us set up on it, and then she will learn it. She will talk with support, she gets us all all set up. So she's really like the systems...

George McCleary: 23:04

Office admin assistant.

Scott Dalinger: 23:07

Yeah, everything.

George McCleary: 23:08

Yeah.

Scott Dalinger: 23:09

She, she, she sent me a very formal email asking for a raise the other day.

George McCleary: 23:14

Really?

Scott Dalinger: 23:14

Yeah. And you know, she absolutely deserves it.

George McCleary: 23:17

Yeah, no, I also have an offshore VA like Shali. Shoutout to Melody. And these, these people, if you treat them right, and you pay them and pay them well, it's not hard to pay them well, it's not hard to treat them right, because their expectations are not high in comparison to what you would be paying for for comparable service here in the USA. And so I have always given steady raises, plenty of PTO and and what you get back is amazing. You know if you find the right people for an offshore assistant, so if you haven't gotten a VA out everybody out there and listener land, get one today, or shop around, you might have to kiss a few frogs, I've definitely hired, I've hired a handful of offshore talent that didn't end up actually being very talented.

Scott Dalinger: 24:04

And give them opportunities to grow too. That's one reason why I give her a lot more responsibilities. It helps me for sure. But also, it helps her because she could develop in her career and grow her skill set.

George McCleary: 24:14

Totally. Yeah. Would you mind if I asked where she was at and what she was asking for a raise wise?

Scott Dalinger: 24:19

She didn't throw a number at me.

George McCleary: 24:21

Oh, okay. She's like, I would just like more money.

Scott Dalinger: 24:23

Yeah.

George McCleary: 24:23

Okay. Okay. Well, you know, that that's fair.

Scott Dalinger: 24:25

So you've given me a lot more responsibilities than I had when I started and since you last put my pay and so please evaluate my salary.

George McCleary: 24:35

Totally. You know, lots, a few times, I've actually raised the salary saying, alright, I'm gonna have you do this project and it's gonna take you a while to figure this out and everything. But after you do that, and after you get that your value has gone up with me. So I'm going to pay you this much more. I've served you said like, Hey, you're getting a raise. Yeah, but you got to learn this thing.

Scott Dalinger: 24:53

Yep.

George McCleary: 24:54

And that I think like is a really good motivator for anybody offshore or not. So, so you built your team, your wholesaling, but then you've also kind of branched off kind of into the next level, because next level in the real estate progressions, shall we call it is, you know, it's wholesaling and then you get into acquisitions and flip and flips. And you've done and you've done some of that, actually, you've done a fair amount of that. So you've gotten into that describe your journey into that.

Scott Dalinger: 25:22

So after wholesale or not after wholesaling during it, we decided to flip a house because we knew that we had a good deal it's a $200,000 house in Milwaukee. But at that time, which was early 2020, we felt like $200,000, we would have been able to wholesale it for 210 and make $10,000. We're like, ah, we know this is a good deal but that's not enough money to make on this deal. So why don't we try flipping it? There was someone that told me flipping is easy. So I said okay, flipping must be easy.

George McCleary: 25:52

Oh my god find this person.

Scott Dalinger: 25:55

Luca Gorman.

George McCleary: 25:57

Luca. Come on, man.

Scott Dalinger: 26:00

So so we bought that house. And you put a bunch of time into it, we did make money on it. And then I realized that flipping is a huge distraction from wholesaling. Once I found myself in the crawlspace, the inhaling pat crap with no masks available, because they were all sold out for COVID

George McCleary: 26:19

Oh, my God,

Scott Dalinger: 26:20

like, this is horrible.

George McCleary: 26:21

So you're swinging the hammer yourself on this first one?

Scott Dalinger: 26:23

Not on purpose. But you know, flipping is is easy, and it's not. And when it's not easy, it's when contractors disappear and walk off the job. And, you know, we learned a lot of lessons and the first one, so when we like kind of lost our contractors in there was no one to pick up the slack. And we were 90% of the way there, I said, okay, let me just roll up my sleeves and finish this stage.

George McCleary: 26:43

Always that last 10% like that last 5% takes the last 20% of the time.

Scott Dalinger: 26:47

Paint and trim and paint and trim and not following up on leads and it was just eaten at me. So,

George McCleary: 26:51

Oh man.

Scott Dalinger: 26:52

I said I'm never going to do this again. And

George McCleary: 26:55

Well then you did. that's when

Scott Dalinger: 26:57

I did but I did it differently. So the next house was one and Beaverton and

George McCleary: 27:01

Wait, how, how much money did you make on that?

Scott Dalinger: 27:03

40.

George McCleary: 27:04

40, okay, so it was 10 with hardly any work with just with just disposition, and 40 by putting in some blood, sweat and tears,

Scott Dalinger: 27:13

That's right.

George McCleary: 27:13

Okay. I mean, a 4x is not bad.

Scott Dalinger: 27:15

Yeah. So we realize, okay, we can do this. This is not rocket science. If we have a good enough fuel, we can flip houses. But I didn't want to distract from a wholesale business. So I told Alejandra, you have to do it and she did the next house, which is in Beaverton and did a great job on that. And then I realized that she's good at it. She likes it. She's super responsible, because she knows that. Basically, she's as she's as invested in it as I am or more. She knows that every dollar that we save through being smart and negotiating, finding the cheapest materials that are good. And getting bids from different contractors. That's an extra dollar in our pocket and towards our family and towards our future. So she's like, the perfect person to have doing this. You would make all the good decisions that I would. But better ones,

George McCleary: 28:07

Right?

Scott Dalinger: 28:08

Yeah.

George McCleary: 28:09

So you so you find another one and you uh, do you make money on your second flip also?

Scott Dalinger: 28:13

We did, yeah.

George McCleary: 28:15

Great.

Scott Dalinger: 28:16

We made about 60 on the second one.

George McCleary: 28:17

Oh, okay. So even better. That's terrific.

Scott Dalinger: 28:20

Yeah. And then we found another one and did that. So you know, I wouldn't call us like, house flippers. If I meet people, I'm not saying I'm a house flipper, but we do flip houses from time to time. Like if we get a wholesale deal, we're like, okay, this one looks pretty easy. We don't like to do any major renovations. We only like to do cosmetic stuff.

George McCleary: 28:39

Yeah.

Scott Dalinger: 28:39

We may keep those and flip them.

George McCleary: 28:41

Okay, so you're mainly doing cosmetic cosmetic stuff only because it's a massive time suck to do anything beyond that, right?

Scott Dalinger: 28:49

Yeah, we're not house experts or real estate experts. Can we, we don't know that much about houses. I mean, we know a heck of a lot more now that we've done as many as we have. But

George McCleary: 29:00

Right.

Scott Dalinger: 29:00

this is not something we ever like went to school to learn or got our GCS licenses. So we keep it simple.

George McCleary: 29:06

Nonetheless, you're still, it's still, it's still on the menu. You still you're still doing it every every so often at least some cosmetic stuff but then also you started to hold stuff because so this is something I talk about with with all the guests cash flow versus wealth building, because the great thing about wholesaling is you're building cash flow you know, you've got money coming in money that you can you know, buy on food, speed boats, whatever you want to buy, but it doesn't necessarily build wealth unless you hang on to it in some way. And real estate is a great way to build wealth we can all agree on that. So there does come a point at some point where you want you want to hang on to this stuff. When does that come for you?

Scott Dalinger: 29:47

That came from me in 2021 I was going through I had a coach that year a one on one wholesaling slash business coach. Was that Zack Boothe? Zack Boothe, yeah. So after we, let's say spent the first third of the year just sort of like dialing my wholesaling processes and building the team and stuff. Then he started to talk to me about wealth building. And he started to have me track my net worth, and put it all in a spreadsheet. And then talk a talk to me about the importance of growing your net worth. So once I put it all on the spreadsheet, then I started to like my brain change the way I looked at deals and opportunities when they came in. So there was a deal that came in with a 230 purchase price in Northeast Portland. And I said to myself, okay, I could wholesale it and make this or I could flip it and make this or I can keep it as a rental and not make any of that and not get that cash, and maybe cashflow three or $400 a month, but add 100k to my net worth. So I decided on that one I'm like, you know, let's let's get our first rental. Let's try this that because I wanted to see that net worth number grows significantly, which, which it can just by doing one deal.

George McCleary: 30:59

That's how you become a millionaire.

Scott Dalinger: 31:01

That is how you become a millionaire. So yeah, so we bought that house, we did a brrrr on it and then we have that as a rental. And then the net worth bump is obviously going to be that all that equity that you have. So that's the difference between the mortgage payment that we got, and then what it's worth today.

George McCleary: 31:16

Gotcha. So you got just a minimal amount of cash flow, you're keeping your head above water because you you financed it conventionally?

Scott Dalinger: 31:22

Conventionally, yeah. And of course, as happened to many people, the rates went up during that so we ended up on that one we're cashflow negative currently.

George McCleary: 31:30

Uh huh. Yeah, that will happen. And I, you know, I'll tell this to anybody who listen, negative cashflow is not a good thing, you don't, you really don't want it in your rentals. But as long as it's really not giving you a massive, as long as you have the cash flow to be able to accommodate it, it's not necessarily going to sink the ship, if you're losing, you know, 100 bucks a month or something like that. But you're still you still have that equity banked and you still have that, that 100k That you didn't have to give up halfway have to half of that money away to the government. So, you know, I still think it's a good, like, it's not a bad thing, if you're chipping away at you know, 1200 bucks a year or something. But you're still like, over the long term, earning a whole lot more than that. Not the worst thing in the world. All right, rant over. But like, but so, so you, so you kept that one and you you started the spreadsheet for your net worth, and by the way, if you're if you're trying to build wealth out there, and listener land, if you're trying to build wealth, you need to have a spreadsheet, you need to track it, you need to see where you're at,

Scott Dalinger: 32:31

You need to know where you're at.

George McCleary: 32:32

Yeah, all your assets and liabilities, myself, and you know, anybody on this show, I guarantee you, they're all keeping track of it on a spreadsheet, they got their assets, they got their liabilities, and they got their bottom line. And that is your net worth. That's your wealth. And when Zack was explaining this explaining to I guess cashflow versus versus wealth, to you, what did he say to you? What stuck out? Because I've got my own little rant on that but I'm curious what Zack told you then that that stuck with you.

Scott Dalinger: 33:00

Well, what Zack said is that when you have net worth, you have more and better options. And it basically it's a it's an insulation against things that can happen, it's the opportunity to do anything that you want in life, the more net worth that you have. So you just have cash flow that can go away when circumstances change. But when you have net worth that to build the solid foundation for you to do whatever it is that you want to do. So,

George McCleary: 33:25

I see. And if you follow, if you follow Scott on social media, he said you will see that Scott does do a lot of things that he wants to do. Scott is an avid adventurer, he goes down to Colombia, he goes on these remote fishing trips. This is kind of why we do this, is it not? I mean, earning money and you know, self actualization, you know, getting to where you want to go professionally feels good, we would do it anyway. But being able to put that money to, to living a good life and having fun and everything. I've, that's something I've noticed that you've done over the past few years. Talk a little talk to me a little bit about that.

Scott Dalinger: 33:59

Well, it's something I've noticed that you've done. If George can do it, I can do it. And so sometimes it gets a little bit out of balance and then you got to dial back and put your nose to the grindstone.

George McCleary: 34:10

oh, it sure does, yeah, I can, I can attest to that.

Scott Dalinger: 34:13

And especially in the Pacific Northwest here we have like three months or possibly four months of good weather per year and then the rest of its crap. So,

George McCleary: 34:21

Yup.

Scott Dalinger: 34:22

we really feel I at least I feel like I have to get as much in as possible during those three or four months. So yeah, working we worked a little bit less here in the summer here.

George McCleary: 34:31

Yeah, yeah, we both basically been on vacation all summer but I've gotten some stuff accomplished definitely have but yeah.

Scott Dalinger: 34:37

Yeah, you gotta keep accomplishing but yeah, I mean, I've been to Colombia the last two years I took my family down spent the whole month there. Last year I went tuna fishing and this kind of very remote lodge only accessible by small prop plane and then by a boat ride in a, in a super panga to get to the lodge and yeah, fish for tuna for a week and it was absolutely amazing. I slept in these huts with the waves crashing right there and mosquito nets over the bed. And that's how I like to travel just like really, really deep and rough in it. And then this year, went back to Colombia for a month. And then we went on a peacock bass fishing trip, just in the middle of frickin nowhere, we rode a 1946 DC3 cargo plane, which by the way, they have one in the Evergreen Museum here in Oregon. That's how old they are. And they're still using them in Columbia. So we rode that with the cargo in the middle over the over the jungle and then over the plains. And then they dropped us on basically like a dirt landing strip out there in the border of Venezuela. And then rode on these old Land Cruisers on a six hour ride on these dirt roads, and then arrive to the fishing spot. So,

George McCleary: 35:44

That's so cool!

Scott Dalinger: 35:44

It's a, that's the kind of travel I love. And real estate affords you to be able to do that, to have the time to do that if you set your business up right, which is why it was really important to me to build a team instead of being just a solo operator. And then of course, it affords us the money if you do it right.

George McCleary: 36:01

Exactly, exactly. And the trends here that I'm noticing with, I guess how you're spending your money and how I like to spend my money is less on things and more on experiences. Do I have that right?

Scott Dalinger: 36:11

Yeah, exactly.

George McCleary: 36:12

Because, you know, I mean, neither of us live in a mansion, you know, we both, you know, do well. But where money gets directed, I think it's a is a great reflection on you know, what we value in life. And I've noticed that the both of us really kind of devote it less to, you know, buying a Ferrari and more about you know, going to that remote fishing lodge are like taking your family to a special place.

Scott Dalinger: 36:33

Right, we we drive used vehicles, we live in a modest house. Yesterday, I bought some used winter jackets for my son off of Facebook marketplace that my wife wanted me to get. So we save where we can for sure. We see we search out deals. But if I have to spend $5,000 to go on a fishing trip that I want to go on, then I have no problem, I have no problem spending that.

George McCleary: 36:59

And down to the smallest things and I've told the story a couple times, until a couple of friends about how you and I, our values align on value proposition in a ton of different ways. Like that $5,000 fishing trip. And the example that I use is what you hit up the group thread the other day with which which was

Scott Dalinger: 37:17

Oh the subway?

George McCleary: 37:18

Yes, the subway avocado. It was Scott said, hey, you know, did you know that avocado at Subway is $2 now? I like avocado but that to me that's just not worth and so here we have a millionaire heading up his brand saying I'm not I'm not spending this $2. It's so, it's so incon...

Scott Dalinger: 37:36

Yeah, I couldn't actually articulate why but, you know, it was a $11 sandwich and I wanted the avocado but I wasn't willing to spend 2.25 for it. So I said, you know, isn't that funny. I'm not going to spend the 2.25 and George said it's because of the value proposition. You like avocado but it's not worth 225. You don't like it to 25 worth.

George McCleary: 37:55

Yeah, and even no matter what it is at what cost is I mean, you know, I've bought you know things that are crazy expensive and crazy cheap and thought to myself like man what a dealer, oh, man, I got taken on this. And that is part of the enjoyment, it's getting as a as a agent as we all get older, it's getting to be a much more significant part of the of the proposition for me. It's how much and you know, how do I feel about this relative to what I've actually paid for it. And no matter how many resources I accumulate this ring, this rings true day after day.

Scott Dalinger: 38:27

As part of the reason I love the exotic deep travel that I do if I'm getting this amazing fish lunch on the beach where they have the fish right there from the ocean, they cut it for me and there's some lady cooking oil on the sand. And it's like so good. And it cost me $7 that tastes so much better than spending $50 on official lunch in Portland, Oregon.

George McCleary: 38:49

So yeah, so true. I, somebody asked me recently what my favorite restaurant was. And I had to think long and hard because you know you live in Portland, you've got amazing food options. And it's not like New York City or LA where you have to completely dump out your pocketbook to to have amazing culinary experience. Like there's so many options. But what I actually chose was a tiny little beach side taqueria down in Mexico at a at a surf break called The Ranch and there's a tiny little taqueria, and it's like this like thatched roof and a grill and they serve chilaquiles and like just basic breakfast basic Mexican breakfast, but you're completely remote, you're on the beach, you're in the shade. It's served to you, you know with like a you know, a Mexican Gatorade or whatever it is. And it's like$3. It's so massively incredibly cheap and so darn good. I go there and I order like three different breakfasts for Gatorade because I've just surfed all day and I'm completely you know, completely knackered, and I just love it. It's gorgeous outside the food is amazing. And it costs next to nothing, you know, and also I'm with my dad when I'm doing it. So my dad and I go on the serve trips together. And so the combination of all these things just comes together to form like a perfect culinary experience. So that is my favorite restaurant,

Scott Dalinger: 40:08

Especially after doing a hard day of some physical activity, like surfing. And then combine that with that value proposition in that in that food, which was incredible.

George McCleary: 40:16

Oh, yeah, it's just it's an absolute climax. It's great. So yeah, so bringing it back to to wholesaling. So, so you eventually you're wholesaling, then you're flipping, then you're, you're starting to accumulate. So...

Scott Dalinger: 40:31

I want to, I want to just one more thing on that accumulating rentals is, there is a moment in 2021 when I bought that first rental, and we're sitting around the bonfire, and George says to me, with the with the deals that Scott gets with his deal flow, there's no reason he can't have 10 rentals by the end of the year. I was like, that's ridiculous. And then it just stuck in my head. It stuck in my head. I'm like, well, what if? And I'm like, nah, it's still not possible. But then I bought another one, and then another one, I'm like, okay, well, once these are finished, that's three, and I just went on a tear, and bought a bunch, which I don't recommend, because it's like, such an incredibly stressful year having all that debt service that we had to pay and then project sitting. And that was really, really stressful, really tough. Put a lot of strain on us. But we came out of it. okay.

George McCleary: 41:22

Right.

Scott Dalinger: 41:23

And now we have a good portfolio. But I mean, really, I guess because I'm really competitive. When you threw that out there, it just stuck into me, like a challenge. I know, you didn't mean it, like a challenge but I made it a personal challenge.

George McCleary: 41:34

I love that. I love that that's where your mind went cause I'm, I'm the same way, you know, and whenever there's a challenge, it compels me to, you know, to reach deeper down and to go and to go further. And I remember that conversation because at the time, I mean, Scott had really amazing deal flow and still does, but I was thinking to myself, like God, you know, he's making these wholesale margins. It's great for the for the cash flow. But you know, if you know, if you talk to me enough, you know, that I'm all about like wealth creation and sort of minimal on cashflow, high on wealth creation, it changes day by day. At least at the time, I could tell that Scott was crushing it in the cashflow game, why, you know, why not translate that to wealth creation. And so I was like, man, with that deal flow, you could just have rentals coming out here, I think I pulled 10 rentals completely out of my hat. But like, but no, but Scott does just that like a year later, you had you know, 10 rentals and try accumulating 10 rentals, you know, in your first year, whatever year and a half, or whatever it is, in real estate it was, it was pretty remarkable. And since then you've accumulated even more, if you're listening to the beginning of the podcast, Scott says, oh, I don't know if it's an empire, if it's got that it's got a lot of rentals that not sure exactly where we're drawing the line at empire. But it's what you've done within a short amount of time is, as is pretty remarkable. And but like, but what's next is, is probably a little bit less single family oriented, and maybe oriented, you know, sort of towards the next level. And so I guess my question to you is, what's next? What's like the next thing that you're working on? Were you excited about?

Scott Dalinger: 43:11

What I'm excited about right now is is twofold. So when it comes to real estate, it's commercial real estate. And what I'm going to be looking for is sort of metal buildings, light industrial. And then to some extent, multifamily, multifamily, like kind of 10 to 20 unit, multifamilies, mobile home parks. So all those asset classes, I want to be finding those deals and wholesaling them. So that's what's next for me. And the reason is, because single family, like you said earlier, it's gotten harder to wholesale, because everybody's doing it, we still find those deals, but we have to spend more money to get those deals. And we're just not getting those lay downs as much. We're in the first year I said, I got a bunch of them in the first few months. And then now it's like, we got one or two a year, where we just have like a huge margin on it. So it's gotten more competitive, but the money that we can make with the commercial is just so much more in you know, I spent a bunch of money and went to Texas to learn how to do this. And I'm excited to implement that. So that that will be next. And then also with with the rentals, it's great for wealth creation, but it really doesn't change our life right now that cash flow is, you know, pretty minimal on on the single families when the rates went up. So that's all going to be for, you know, my future 10, 15 years down the road, I'm sure it's going to be great cash flow, but doesn't really change my life very much right now.

George McCleary: 44:36

Yeah, no, that's the thing. You have to be patient and if I could just give you one piece of unsolicited advice is just you know, be patient with those because the first rentals I bought were like in the mid 2000s When I was 20 some year old kid didn't get but still did it anyway. And I gotta tell you, man, there is not a single rental that I've ever had that hasn't been at least a little bit of a thorn in my side, you know, over the years, and we're talking about my entire professional career. And so, um, I've kept some of them, I've sold some of them, but like, I tell you what, man, like, every single one of those that some of them still have the original debt service from back then, and I've got equity positions that I really do need to have a position I need to trade up, but like, but yeah, it's really kind of hard to walk away from the cash flow that comes when you just own these assets for long periods of time. And so when you're an old man, when you get to be my age Scott's younger than me, I'd like to point that out, every so often, when you get to be an old man, and you've you've got, you know, debt service that's barely breaking even cashflow negative right now, it won't be like that for long, you know, I'm, I'm optimistic about the long term out prospects of real estate, Portland, of, you know, all the all the above. And so you're gonna be just fine, I guess is what I'm saying. But sounds like next for you is sure, like, the next chapter is going to be a bigger commercial and kind of transitioning a little bit, not completely out of residential, but kind of more on that in a commercial direction.

Scott Dalinger: 46:05

Definitely. And once this takes off, we may shut down the residential completely. Yeah, at least when it comes to wholesaling. But we want to I want to keep maybe one, maybe two per year of the of the commercial stuff, and wholesale the rest, and just a mass capital. And the second thing that I'm interested in for the near future is, and this is completely unrelated to real estate, because I don't really care about real estate that much. It just happens to be what I do right now.

George McCleary: 46:31

Right.

Scott Dalinger: 46:32

And, and I think I'm okay at it. But I want to find some business opportunity in Latin America, because I have worked there in a sales capacity in the past and Colombia, Ecuador, Peru, Chile, Dominican Republic, Mexico, I travel all these countries and sell and I loved it. That was like, I would have paid to do that job and they paid me.

George McCleary: 46:50

There you go.

Scott Dalinger: 46:51

So but you know, there was no wealth creation, and there was no savings the first time around when I did it. This time around, I want to build a business down there. And I want to build a business that's large and scalable, like a McDonald's type of thing.

George McCleary: 47:03

There you go. I love it.

Scott Dalinger: 47:04

And and maybe it would be a McDonald's because they don't have good hamburgers in South America.

George McCleary: 47:10

Oh, man. So if I could, like take the in and out kind of burger and scale it across the whole region, but just something like that, that I could scale across the region. That's the kind of thing that I think about all the time. That's really exciting for me, so I'll continue with the real estate and but I'm gonna put people in charge where they can participate heavily in the upside and and keep things running up here and then build something down there. I love it. Yeah, dude, that's just the entrepreneurial mindset. I love it. And there's no doubt in my mind that whatever it is, whether it's being the Colombian, McDonald's or, or whatever it is, that you do it on, or that you'll succeed. Scott, Scott Dalinger, is not only is he a great guy, but he's a, the slogan that I always use in front of him in front of everybody is "don't sleep on Scott Dalinger." Whether whether he's doing real estate or really anything else, the guy is gonna crush it. And I have every confidence in him. And, dude, I super appreciate you coming on here and talking about your life and your business and everything. It's a it's been great to talk to you, man.

Scott Dalinger: 48:14

Yeah, thank you, George. Thanks for having me. I'm still not really sure what this podcast is about but I know we're talking about my business here today. We're talking a bit about real estate, excited to hear the other episodes and, you know, interesting to reflect on what we've accomplished in three or four years, but it's about it's about what we're gonna do in the future. That's what.

George McCleary: 48:30

Oh, yeah, yeah. No, in this show, I take millionaires, I dunk them in cold water, I talk to them about their businesses. And that's what we've done today. So you've done a great job doing that. How do we how do people find you if they want to find you?

Scott Dalinger: 48:42

I have an Instagram, which is Scott Dalinger Real Estate, and that's kind of the main thing that I put stuff out there on,

George McCleary: 48:48

Right on, alright, well, hit him up on Instagram.

Scott Dalinger: 48:50

Let me just say thank you to you, George, you've been a great inspiration and inspiration I'd say with real estate and kind of with lifestyle. I love how hard you charge, your athleticism, the way that you've run. You brought me onto your running team, your relay team, the 11 Jerks in a squirt the past few years, and you're just always up in the ante with with physical feats, with family vacations, with wealth creation, with real estate, you're always pushing the boundaries as to what's next. And I take that as a huge inspiration. So yeah, you've inspired me a lot.

George McCleary: 49:23

Thank you so much, man. I really appreciate those words, man. I really do. It's, it's what I aspire to. And I like to bring people on the show that just think, feel and act similarly. And so Scott lives that and that's why that's why he's a frozen millionaire. All right, thanks again, man.

Scott Dalinger: 49:40

Love it, thanks.

George McCleary: 49:41

All right, have a good one. So that's the story of Scott Dalinger, one of my favorite people. And I'm going to repeat something that I said in the podcast, which is Don't sleep on Scott Dowager. And the reason for this is the rate of his ascent in an ultra competitive space. His ascent to financial freedom using real estate is truly remarkable. And if I started at the rate that he did, I'd probably be doing this podcast for my own private island. His work ethic is contagious. He's a family man and I have a lot of respect for him and what he's built. I have a feeling we're going to be seeing even bigger things from this guy as he continues kicking ass and taking names in the world of real estate investing. Be sure to subscribe on YouTube and follow me on all your favorite social platforms. Just search for McCleary Realty and Development or me George McCleary. We'll see you next time and until then, be sure to embrace the cold to ignite the dream.