Technology - In science fiction, technology assists humanity…but sometimes rises up against us! Although we may not be in danger from the rise of the machines (yet!), there’s no denying that technology is nearly all-pervasive and plays an essential part in our lives.
New technologies – from hardware to apps – empower investors to run bigger yet more efficient businesses at the touch of a button. Technology systematizes and streamlines processes, creating predictable and smooth-running operations. Technology also speeds up communications and interactions. For example:
- Rents are collected instantly and bill payments can be automated, creating an even more hands-off investing business;
- You can communicate more easily and remotely with contractors: They can take pictures and share them with you so everyone is on the same page about the extent of work required;
- You can communicate with individuals and your entire team at the touch of a button;
- Record keeping is improved, which keeps accountants happier;
- Access to information is unfettered, so you can do your due diligence and even enter new marketplaces from the comfort of your home; and
- You can do most of this from your laptop, tablet, or even mobile phone from anywhere in the world.
In my opinion, there’s never been a better time to be an investor. All this technology and access has levelled the playing field to allow even the “average joe” like you and I to do more deals and bigger deals that were once reserved only for people who had special access.
It’s tempting to look at all this technology and think, “Wow! I need to adopt all of it in my business right now to improve my investing.” However, there’s a missing piece to this technology conversation that investors should be careful not to overlook.
Technology creates opportunities but it’s not the “be-all and end-all” of investing. We invest WITH technology, not BECAUSE OF it. Technology is just a tool. There are two lessons to learn here:
Lesson #1: Don’t Be Mastered By Technology
First you need to remain the master of technology and avoid letting it master you. What I mean is, deploy technology in your business but don’t let it replace your own knowledge and expertise. Specifically:
- Use technology to help you understand the numbers but know your numbers inside and out. You should be fully aware of your income, your expenses, and your profit, and what factors influence each one.
- Make sure you back up your data regularly. The loss of critical data can have a detrimental impact on your business. You and your team rely on this information regularly.
- All technology is an investment, so make sure it has an ROI. Avoid being mastered by the “shiny object syndrome” and adopting technology for technology’s sake. Instead, just like any other investment, take the time to do your due diligence and make sure a piece of technology is right for you, and then invest the time and money into acquiring and adopting that technology.
- Be proactive. Don’t wait for technology to alert you that something is wrong or that there’s a shift in the marketplace. Instead, proactively stay on top of your market and your properties and rely on technology as another source of monitoring.
Technology is a tool but you remain the master. Don’t let technology fool you into thinking it’s in control.
Lesson #2: Use Technology to Enhance Relationships, Not Replace Them
Technology allows us to connect with others – real estate professionals, tenants, property managers, contractors, etc. – but technology is just a tool; it’s not the communication. What I mean is, focus on the relationship and not the technology. Specifically:
- Communicate in a way that serves you best: Use Skype™, phone, email, and even “old school” methods like face-to-face and traditional mail. Figure out the way to communicate most efficiently and make sure it’s a method that allows you to keep a record of your communication.
- The rules of relationship building don’t change, even if the tools to build that relationship do change. In other words, find out how you can help other people and serve them. As Zig Ziglar said, “You can have everything in life you want, if you will just help enough other people get what they want.” That’s a rule that stays the same in spite of the increase in communication options.
- As much as I love technology and its ability to let me communicate with anyone, anywhere, sometimes there is no substitute to a great face-to-face conversation in an office or over coffee. The efficiency of technology sometimes needs to be traded off against the value of a human connection. A handshake is still a powerful tool.
Relationships are the most important part of investing. As an investor you provide a service to each of the people you work with: to sellers you provide an easy way to sell their property; to tenants you provide a place to live; to property managers you provide a job; to contractors you provide a job. Use technology as a way to help you build relationships and serve others.
I’m a big fan of technology because of its ability to empower investors to run efficient investing businesses from anywhere. But investors should always be mindful that the most successful investors put people first and keep technology as a tool to enable better relationships. We live in an exciting world of rapidly advancing technology and we can’t even conceive of the amazing hardware and apps that we’ll see in just a few years. But none of these things will ever replace the value of a human-powered investing business.
Brent Roberts started to invest in real estate and bought his first “door” at the age of 18. Brent owned 18 houses prior to becoming a Realtor®. He decided to take the real estate course in the late 1980’s to become a more educated buyer. He was then convinced to become an agent and has never looked back. Contact Brent at firstname.lastname@example.org.