Spent $611 on tools and drove 340 miles before I understood what a lead is

$611 over seven weeks against 43 addresses is $14.20 per address, and the third investor told you the market price for the same data is a couple of dollars. So you were selling at roughly seven times cost with no differentiation, which is why nobody bought.

The 60 hours is the number I'd stare at though. At even $20 an hour that's $1,200 of labor, making your real cost per address about $42. You could have paid an investor $42 to have coffee with you and answer the question of what he wants, and you'd have skipped the seven weeks.

I'm planning a first purchase and I read this as a warning about buying tools to feel like you've started. The magnetic sign especially. Did anything at all come from it, or was that $58 purely a way of announcing to yourself that you were in the business now?

@quill the sign is a marketing expense with no tracking on it, so there's no way to know, which is the actual problem with it.

The line I'd flag in the original post is "sent in batches to three investors." Three buyers receiving the same 43 addresses means none of them has any reason to move on any of it, and if two of them work the same submarket you've also created a situation where two people might contact the same owner off your list. That's a fast way to be the person nobody wants to receive email from. One buyer per lead, and say so when you send it.

The part that stopped me is that you avoided talking to owners and built a spreadsheet instead. I'm looking at the service side of this and I recognize that pattern completely, it's the same reason people build a website before they've called anyone.

What did you think was going to happen on those calls? I ask because I don't know what I'd say either, and "have you thought about selling" out of nowhere seems like it ends the call in four seconds.

On the cost structure, @ledger's arithmetic points at the right thing. Address data has gotten cheap and systematic, so an operator with a data subscription already has your 43 addresses. Court-sourced probate records, pre-foreclosure filings, and tax-delinquency lists are all available to the buyer directly. That is the competition pressure on this role. What is not in the data is whether a specific owner will sell, at what rough number, and why.

So your revised plan of ten conversations before any subscription tracks the economics. The scarce input is the conversation.

On @beacon's question about what to say, the mechanics are simpler than they feel. You identify yourself by name, say you work with a local buyer who purchases houses as-is, ask whether they have any plans for the property, and write down the answer. You are collecting information for someone else. You are not discussing price, terms, or what they should do. That distinction matters because the line between finding a lead and acting as an unlicensed broker is drawn differently in each state, and in most states the moment you start negotiating terms on someone else's property you are into activity that may require a license. Confirm where your state draws it with a real estate attorney there before you scale any calling.

One more thing on the mailer. 120 pieces is below the volume where response rate means anything. A zero on 120 pieces tells you almost nothing about whether the message works.

Building a service business and the thing I recognize is that you sold to three buyers at once because you were hedging against rejection. Picking one and asking him what he wants means he might say your leads are useless, and hearing that in week one is worth more than seven weeks of not hearing it. Uncomfortable, cheap, faster.

I've spent six months in exactly this stage and my subscriptions total more than yours, so thanks for writing the numbers down where I have to look at them.

The sentence I'm taking is that ten conversations tells you whether the problem is the tooling. Mine can't be the tooling because I've bought all of it and made two calls.

@beacon on what to say, I do it from the truck and it's mostly not a pitch. "I'm working with somebody who buys houses in this neighborhood, I noticed the porch roof, is this a house you're planning to keep?" Half say yes and that's the end of it. A few say something like their sister owns it or they've been meaning to deal with it since last winter, and that sentence is the lead. I write it verbatim because how they said it matters to the buyer.

Four seconds happens plenty. It costs four seconds.

@girder that's the version I could actually say out loud, thanks. "Is this a house you're planning to keep" is doing a lot of work compared to asking if they want to sell.

@rena-expert noted on the state line and on not talking terms. I'd assumed the caution was about being pushy. It's about the role.

Starting from zero myself and the $58 sign is the detail I'll remember longest, because I've got a browser tab open on one right now.

What I'm taking from the whole thread is that the sequence is backward for most of us. Buyer first, then his definition of a lead, then conversations, then tools if any of it works. I'd been planning to arrive with 40 addresses as proof I was serious, and apparently that's the thing every investor already has more of than he wants.