Join us as we talk with Kent Grothe of PMI Northeast as he shared about managing HOAs in Atlanta and how he transitioned from Corporate to Business Owner. We talk about how he used HireSmart Virtual Employees to expand his reach and gain more customers and how he also has improved customer service too!
Want to know how to start with your virtual staff member too? Feel free to book an appointment with today so I can definitely help you all throughout the process!
Anne Lackey: Welcome. My name is Anne Lackey. I'm so excited to be talking with you guys today. And I want to introduce you to Kent Grothe, he is an owner and broker of PMI Northeast Atlanta. So some of you guys might not know, but there isn't a couple of franchises in the U.S. for property management. And of course, that just helps you get to your systems quicker and things like that. So he came into the property management business in 2016 after he left Corporate America. We'll certainly get into that. I want to find out more about that. And I guess he was traveling a lot and wanted some more quality of time with his family.
And of course, after three years, the company has grown and his wife and he has decided just to kind of open up their own business and have grown here in Atlanta. They're actually in my backyard, which is kind of fun. I get to see him on a regular basis. He's going to talk a little bit about being a part of a franchise. We don't have too many spotlights yet on our franchisees. So I've kind of really interested to know a little bit more about that. And certainly excited to find out more because he does a lot with HOA. So Kent, welcome to the program. Thank you so much for being here.
Kent Grothe: Thanks for having me and I appreciate it.
Anne Lackey: Oh, it's my pleasure. So we've been doing this for a couple of years now, I think, right?
Kent Grothe: We have. Yeah.
Anne Lackey: That is always exciting to me when I get to talk with veterans about how... Everybody's kind of bright and shiny the first year, but this really becomes a game changer. Year two, three, four. And one of the questions we have a lot of times is, what's the turnover rate? And when I tell people the turnover rate is usually very, very low, people don't believe me. So kind of share with us a little bit about your... First of all, your corporate experience, why you went into property management? Why you selected to buy a franchise? And then we'll kind of get into using staff. So start us off with a little bit of history, please.
Kent Grothe: Okay. So we started this... Actually about 2015 is when I really started looking into it, 2016 is when we got rolling. I had a very successful corporate career. I was a Vice President of a Fortune 500 company. A great job by a lot of measures except that I traveled quite a bit. And with a family that gets to be a bit difficult. And as my kids were getting older, my son was about to go into middle school, that's when it just hit me. I don't want to do this anymore.
So I told my wife, "I want to try something else. I want to find something different." And I actually didn't start off looking for a business. I started looking for one of those kind of jobs I had that didn't involve travel. They're kind of like a unicorn, they don't exist. So I just happened to run into a guy along the way that helps broker deals for franchises.
And I looked at several of them and thought, "I've been making money for a lot of other people for a long time. Maybe I should do this for myself." And that's how we got into this. So property manager was a natural fit. I had an operations background, that's what I've done my whole career. My wife, who's in the business with me, also has an accounting background.
Anne Lackey: Okay.
Kent Grothe: So a great foot as well, right? So that's how we got into it. We picked a franchise because I didn't have a property management background, so I needed something to give me some legitimacy in the beginning. I needed a brand. I didn't have a brand, I was just a guy. And so PMI gave me a large national brand to go out and sell with. Now it's transitioned over the years and now I sell us, PMI Northeast Atlanta, versus PMI the franchise, a lot more heavily because we have something to sell. We've got experience. We've got a local brand. So that's kind of how we got into the whole thing. I just wanted to quit traveling.
Anne Lackey: I believe you. I talked to my stepson all the time who's kind of on that same track that you're on. Traveling and he just had his second child. And it does, it wears on you because his kids are young too, and six months.
Kent Grothe: Yeah.
Anne Lackey: So when you're gone three out of five days and trying to manage that, it can definitely wear on you. And I do think when your kids get older, they miss you more.
Kent Grothe: Yeah.
Anne Lackey: You miss part of their growth. So I love the fact that you dedicated this to your family. So now, unlike maybe some of the other property management companies that focus on single-family residential homes, you have a little bit different focus in your business primarily. Tell us a little bit about why you chose that and what it is.
Kent Grothe: Okay. So we have... I don't know that we chose it, I think it chose us. But we... PMI offers you the opportunity to get into four different types of a property manager, right? So residential, association or HOA, commercial and vacation. And so I started off looking at association and residential because there's so much of both around us. And I think my corporate background is probably what helps me in those HOA meetings with those boards. Because I have a business background and operations background, my wife's got an accounting background. We're bringing a lot of the things they're looking for. A lot of these folks on HOA boards are business people, right? And so they... Those conversations sort of resonate a little better.
So we just naturally ended up in that space far more heavily. We do residential but very, very small, 34 homes. So a tiny residential business and a growing good size HOA business. So that's kind of... It did its... We didn't really pick it on purpose. Nowadays we are actually because we found that to be our strength, we are focusing in that direction.
Anne Lackey: Sure.
Kent Grothe: Yeah, and that's what our VA mostly does is our HOA business.
Anne Lackey: Okay. So let's transition it over to her. So she's been with you a little over two years now.
Kent Grothe: Yeah.
Anne Lackey: So what was that like? Kind of think back to two years ago when you were thinking about, "Gosh, what do I do? How do I grow?" What were some of your thought processes that you went through before you decided to hire virtually?
Kent Grothe: So the... You know as you grow, especially in HOA business, you have a lot more customers early on, right? Because every HOA you're picking up 50, 100, 200. The phone starts ringing and that gets to be... If you want to do well, you've got to provide good service. And that means you've got to answer that phone. You've got to return those phone calls. It got to be that time was just, it was a killer. We got big enough that there wasn't... There really weren't enough hours of the day to get everything done anymore.
And I was at... I remember, I don't know if you remember this one, but we met in Savannah at a conference, right? And sure enough, you told me, "Well, you're not going to do this right now. You're going to go home and you're not going to do it." You said. "Three months, six months down the road, you'll finally do it. And then after you get started, you're going to tell me, Anne, I should have done this a long time ago."
And you were right. That's exactly what I did. I didn't do it. I waited too long. I should have pulled the trigger way before I did and I definitely waited too long to do it. For us, it was a game changer. We'd hit the point where I could not grow anymore because I have to sleep at some point and the business was getting that busy. But it wasn't big enough that I could really justify a full boots on the ground fully loaded employee cost at Atlanta rates. It just wasn't there. This was the solution. And Carla has been with me a little over two years. She is awesome. I hope she's with me another 15.
Anne Lackey: She really loves working for you. I actually just talked to her not that long ago. So I love the fact when I can bring those matches together and provide a great career for the virtual professional as well as give relief to the business owner. It's so funny, you mentioned the story of our conversation. The conversation is the same conversation I had with myself when I look back five years ago. Gosh, it's hard to believe I've been doing this now for five years. I always say my biggest mistake was waiting too long to hire my first and my second biggest mistake was waiting too long to hire my second because... Out of fear.
And really when you break it down psychologically and financially you're like, well this is silly. Like it's so cost effective. I can actually have three VA's for the cost of one person and their productivity is so much higher than what I was getting. Now again, there may be better managers than me, I don't know. But I wasn't getting that type of productivity out of my in-house staff. And so it truly was a game changer for me. And so I loved the fact that my clients also feel that it really helped them in their journey and in their business.
So one of the questions that always comes up is, "Well that sounds great Anne, but realistically, what can they do?" So now that she's... Carla's been working for you for a couple of years, tell us what she does for you.
Kent Grothe: Anything you can do with a computer and a phone.
Anne Lackey: I say that too.
Kent Grothe: That's literally the answer. I mean it's anything you can teach them to do with a computer and a phone. So they're not physically here. So there's things they can't do. There are things you won't have them do in terms of maintain the separation of duties within your business. So they're not going to cut checks. Of course they're not here anyway, but even if they were. So there's things you're going to do that you wouldn't do in any normal business. But otherwise, the best and most important thing to do when you first bring on your VA is pick up that phone. That's the difference. Most property managers don't. If you've ever called another property manager, you figured out what they're mostly like. They don't answer the phone, they rarely ever call you back.
So that is, if you want a game-changer from service, first thing you do is you get a decent phone system that they can pick up for you. Answer live during the day. People don't expect it. They're blown away. Then you'd give them access to your system so they can get in and answer questions.
And so most of our HOA calls, I never hear about, I don't see them. She resolves that first call, done. So someone calls up, they don't expect an answer, they got one. They don't expect somebody to be nice. They got that. And they don't expect to be helped. And they got that. They get off the phone and they're just like, "What happened? I can't believe this."
And so she can get in, she enters bills, she helps coordinate maintenance. So if we need, "Hey, get this vendor in touch with this tenant or in touch with whatever. Give them this gate code info for an HOA. Give them the address." She can do all that. Coordinate with vendors for us.
And I'll typically provide some guidance on, "Okay, here's the three I want you to call for that particular account. Call in this order, the first one that can take it, gets it." That kind of thing. Or get me bids. She's just getting me quotes and provides me the information.
She helps me with a lot of data entry. So as we bring on a new association... Still when you bring on a residential, you've got a lot of setup work to do. So you've got to enter a whole bunch of information. In our case, it's all the homeowners and the vendors and all that. But similar to if you're entering a lease or entering a new property. She can do all that kind of data entry for us and help us set up a new association. So really anything, again, that you can do with a computer and a phone. I don't think people get it.
Anne Lackey: They don't.
Kent Grothe: So Carla has... She's a college-educated, professional that works for me. So anything you can teach somebody in the office, you can teach her to do. You have to put time in, you have to take the time to create some instructions, whether they're... And I do a combination of written and video. So I'll often video, just do a screen capture of training or how I'm doing something, often while I'm on the phone with her. So I'll just record while I'm talking to her. And so I'll keep that, so she's got to back up for later. And for the next VA and the next VA. I'm building a library.
And then we also provide some written instruction. You've got to take the time, but you would do that for a local employee. It's no different. So anyway, what can they do? Pretty much everything.
Anne Lackey: I love that. And it's funny, I tell people the same thing too. Like they're just like your employees.
Kent Grothe: Yes.
Anne Lackey: Except with a lower bill rate, no payroll tax. No 1099, none of that. And other than that, you're training them the way that you want them done. You're investing the time. They're following whatever holiday schedule you've got or paid time off that you have. All of that's kind of the same. And the more you treat everybody kind of like the same way, the better results you have. So have those regular one-on-one meetings with them and talk with them and build that relationship with them.
And I think after, again, five years of doing this, I have seen that the clients either fall in one or two categories. The people that really win like yourself, embrace them as employees. Really truly care for them, know about their families, talk to them on a regular basis and they become that valued person. Or they are in the other camp, which I don't think is as successful, where they're just giving them tasks and they're really not investing in their people.
And I think that the clients that do that are really missing out on the real benefit of what this process has to offer.
Anne Lackey: Their VA's are not as engaged with them because they're not engaged with the work, right? You've got to be able to kind of wrap your whole self in this process and the more you invest in them and their training and their professional development. I mean a lot of them... Like I've put my VA's through specific courses because I want them to learn more about a particular topic. And I pay for that for them and I pay for the time. But it benefits me and my business because that's an additional skill set. And they love it. They love the fact that they are growing, that they are expanding their horizons and they rise to the top. And I also think one of the biggest misconceptions that people have is that they aren't smart. And that has never been my case. Share with us kind of your feedback on that.
Kent Grothe: Oh yeah. So again, Carla can learn things so quickly. That's what's really great about her. I can show her once. And unless it's a particularly complex task, that's it. I don't ever... And she'll look up the instructions she has. And I think the thing people miss too is initiative. So they're not just smart. She looks for work to do. So if she gets to a point where it's slow, she'll be going through our to-do list, looking at, "Hey, there's this task, can I do that?"
"Yes, thank you. Please do." Maybe I have to teach her how, but now she's just told me. Here's another skill I can teach her.
Anne Lackey: Sure.
Kent Grothe: So I think beyond just the fact that these are educated, smart people, they've got the initiative to want to work. They don't want to sit around doing nothing. They want to be busy.
Anne Lackey: They do.
Kent Grothe: And that's a big deal. And the other thing that, with the engagement piece you were talking about, that really reminded me of some stuff. I've gotten notes like when people send in their payments and things. I think I may have sent you one.
Anne Lackey: You did.
Kent Grothe: Little handwritten things like, "Oh thanks, Carla. You're awesome." From an HOA owner paying their bill. Who does that?
Anne Lackey: Right.
Kent Grothe: I have people that come in the office and they're like, "Is Carla here today?"
"No, she's working remote today." You know?
Anne Lackey: Yeah.
Kent Grothe: But they come in looking for her because they know her, they call her and they talk to her. She's the voice of PMI. So that engagement piece, if they're going to be on your phone and they're going to be working with your customers and your clients, that's a big deal. They need to be excited and to be happy. They need to know what's going on in the business. So I tell her every time we bring on a new client, that's a big win for us, every HOA is a significant win. So she knows about that. So that engagement piece is important. I get what you're saying, that people that don't do that, they're missing out. Absolutely. Because they become part of your brand.
Anne Lackey: Right, exactly. And it... Probably one of the most interesting things for me too is, like you said, their initiative, like they really want to work. And sometimes when I ask their opinion on something, like, "Well, what do you think? How do you think we should handle this?" I am blown away by the commentary that they bring. Things that I wouldn't have necessarily thought about, but because most of our VA's have been working at big call centers for big companies and big corporations, they're exposed to things that are all about metrics and how to do things faster and processes.
And it's just been surprising to me that some of my best ideas aren't from me. They're from my staff as we talk about a particular issue or item. And so I love the fact that you also engage with Carla in that as well. Looking back, what was kind of the hardest thing? So we talked about all the good stuff. Let's talk about-
Kent Grothe: Right.
Anne Lackey: ... Maybe what was a little bit of a challenge or what was something that you could help somebody realize or help them overcome? And how did you overcome whatever that was?
Kent Grothe: So I think one thing you get... I talked to a lot of our franchisees who are... They're small, they're growing, they're kind of that point where I was, where they're getting overloaded. And they always struggle with the cost piece. Like, "Ah, but that's X dollars a month. X dollars. X dollars."
I go, "Okay." So I always rock them through a little different way. "X dollars. That's fine. But let's look at on a daily basis. So take their hourly rate depending on whether you take this plan or that plan. Take the hourly rate, figure it out on an eight hour day. Okay. How many dollars is that?"
It's not very many. I say, "Okay. What's your time worth? So how many hours or minutes of your time does it take to pay one day's pay for that virtual professional to work for you? In my case, it's about 40 minutes."
She does about 40 minutes of my work. Whether it takes me off the phone. I am already happy. So they get hung up on the cost and they get hung up on, "I don't have 40 hours worth of extra work." You don't need 40 hours' worth of extra work. You just need a few hours in your day. You'll come up with 40 hours, don't worry, you'll come up the work once you figure out what they can do." Because they think they're just a phone machine. They don't really quite get it yet.
So I have to coach a lot of folks through that initial hurdle of don't obsess over 40 hours worth of tasks to manage, don't obsess over the cost. When you break it down and really look at it, the value it brings to your business by freeing you up to work on your business instead of doing... Answering the phone or whatever you're doing. It's huge. I mean it's just a no brainer when you can take the emotion out and really logically walk through it, you're just like, "Oh my gosh, why have I not?" That's what happened to me when I really looked at it. Like, "Why have I not done this yet? That was dumb."
Anne Lackey: And like I said, me too. The first one... Because I was worried about the same thing. Like do I have 40 hours worth of work? And finally I decided it was so painful for me that even if they were only busy 20 hours, I didn't care.
Kent Grothe: Absolutely, yeah.
Anne Lackey: And it was double the price. So basically I'm only getting... It's going to be double the price. I honestly didn't care because those were things that I didn't want to do and it was taking up my headspace and it was keeping me from doing what I really needed and wanted to do. Like you said, working on the business. So I love that.
The other thing that people go, "Well you got a recruiting and certification fee." So we get that quite a bit because you got other people that have call centers and you can pay as you go. Totally get that. But if you look at what you get from-
Kent Grothe: Yeah.
Anne Lackey: I mean I'm a trained recruiter, like if I was getting paid normal corporate dollars for these VA's, it would be so much more money. But our process works. There's a reason we have a 97.2% success rate in my placements. And people don't realize that the costs of you putting out resumes and screening and then hoping you get a good person and you don't have access to the same testing that we do. You don't have an access... And you don't know what you don't know. I mean, all of this stuff just kind of really blows my mind.
But our process is such that when I engage with a client, I get to know their needs. And I've done it so often, I know exactly kind of what personality profile they need for which position.
Kent Grothe: Right.
Anne Lackey: And then we do the criminal background check. That's probably been the most... Not every country can you do that. And I don't think people realize that. They think, "Well, I'll just hire." Well we're dealing with people's personal data. For me personally as a broker, I wanted to make sure that I've done everything that I can to keep it safe. Like I mean, again, you can... Stuff happens, we all understand that. But to the best of my ability, I want to make sure my client's data is as safe and secure as possible. So the criminal background check alone is worth the price of admission.
And then when I work with each placement, and I do, I mean I have a team that helps, but I personally know every VA that goes through our training program. I look at their work, I personally test their communication. So everybody that comes through our process, I've had a hand in there to make sure that they're good. And I think that that's the next piece. Like you're not getting just a room full of VA's and "Oh here's the next one. And yeah, they've been working with me part-time doing stuff. But here, they'll work for you."
I mean it's kind of a custom shoe versus a buy off the shelf. Like I customize my placements for my clients. And to me, the value in that is worth the price of admission too. And of course since you did it two years ago, we've even gotten even exponentially better and I was pretty good back then. Now I've got data to actually support my theory. So back then I was dealing with kind of some contextual theories and testing some stuff out. And now we've gone to an empirical testing where we are doing... We're using a Fortune 500 level type testing software that I've adapted for the. So I spent the last year and a half really kind of digging into the data. Because I like things that are duplicatable, repeatable and processes that work. And so whenever there's a failure, I kind of unpack all of that.
So I love the fact that you're helping other business owners understand the value of all that. And not only that, just their time. Because again, there's so much head space that we waste thinking about something that's relatively simple that if we had somebody else handle, it would allow us just to do so much more in our business and grow. But I think a lot of times, and I'm guilty of this too, we like to be busy and not necessarily productive.
Kent Grothe: Right.
Anne Lackey: And so I have to kind of catch myself in my own world and go, "Okay, am I doing busy work? Or am I doing something that actually is helping move the business forward?" So you're smarter than most of us, myself included in that. So fast forward another year from now, what is your... What does your business look like? What do you... What's your staff look like? Kind of share with us a little bit about what your vision is as you progress in the next year for growth.
Kent Grothe: So I would say in the next year... We're about to put the second boots on the ground job here. We've actually got a posting out. I anticipate if things go the rate they're going, we'll put one more on next year and probably a second virtual staff member sometime mid to late year, depends on how things go and how loaded Carla gets. And so I've talked to her regularly because I know she's going to hesitate to tell me. But I keep telling her, you got to let me know when you get too... Because you can't see them. So you can't see just how really busy they are. There's only so much oversight. So you've got to engage with them and make sure they understand, "It's okay. If you're too busy, you need to tell me. Because if you get loaded up too much then that affects the business. We can't grow." And so she gets it, she just is a people pleaser, that's her personality. So I keep in mind... Let me know.
Anne Lackey: One of the things we do to help that is, we are actually, every 90 days, reviewing that with every VA. So Daphne, who our client relationship manager-
Kent Grothe: Yeah, I know Daphne.
Anne Lackey: ... That I brought on board about 90 days ago, has really kind of embraced that role and has made it a point to have those regular scheduled meetings. Just to check in, make sure that there's nothing... Because they'll talk to her where they won't talk to me or you.
Kent Grothe: Right.
Anne Lackey: They're just... Not that they're afraid, but they just... They're not as open.
Kent Grothe: Yeah, we're the authority figures.
Anne Lackey: Right. But she can get the dirt. So I love that about her because she's very friendly and very nice and certainly I think that that's, again, another benefit that we help our clients. Because you don't really want people to be so busy that they burn out. That's-
Kent Grothe: Right.
Anne Lackey: And the VA's, from the scale of workability, tend to go more on that realm. Like they'll overwork themselves and then are lazy and don't work. Like you said, Carla likes to be busy, right?
Kent Grothe: She does.
Anne Lackey: So that's important. You know this... We're currently in the fall... Some of you may be watching this a little bit later. So in the fall as we go into the holidays, it's always, at least in my business, is a little bit lighter. And so one of the things that we're doing also is saying, "Now's a great time to catch up on those kind of projects that haven't been done." Insurance audits, making sure that vendors have all of the credentials that they need. All of those types of things that, again, we know we need to do but we just really haven't done yet because life kind of gets in the way. So are there any other types of projects like that that you have on your list for Carla to do that might be helpful to some of our listeners?
Kent Grothe: Sure. So the residential property managers are not going to love this, but we do leasing and management as part of our HOA business. So we provide some oversight for all the leased houses. And do we have a current lease? Do we know the current tenant contact info? Have they paid their leasing fee? Et cetera. And that is... That takes time. It's a bit tedious. But this is a good time of year to do it. Because the pools are all shut down, because in the summer we're dealing with pools, right?
Anne Lackey: Yes.
Kent Grothe: And it gets crazy busy for us with all that stuff. So now that's all behind us, and the landscaping, everything's settling down. We can get into those kinds of projects. On the residential side, of course, yeah it's the, let's make sure all that residential insurance, the renter's insurance is up to date. Check through all our vendors and make sure that the vendors aren't missing any COI's. Those kinds of things. So that's... It's a lot of that catch up stuff you can do in the off season. Same as you. Just different because it's a different from my business.
Anne Lackey: Sure, sure. Well and it goes through... This is always a chance for us to source out new vendors too. I want to have vendors on board and vetted before we get really busy in the spring. So we'll have... We'll try them on some jobs now, get them... Kind of test their waters so that when we get super busy in the spring, we know we've got a line of defense that is strong enough. So that's... Researching vendors is another big key for us. And very, very helpful as we, again, gear up for spring. Well Kent, what was one piece of advice or aha moment that you'd like to share with our listeners about using virtual staff?
Kent Grothe: Getting over that initial hump, that pay thing, people get hung up on that. They really need to stop and just think logically about what's your time worth? Because what you're buying in the beginning is you're buying your time back. Whether that's to grow your business, to spend time with your family, just to get some sleep. And all of us get to that point as you're growing a business, it's lonely at the top and you're where it all stops when you're the owner. And so you're going to get that busy and don't wait too long.
The other thing is having a fully trained staff member like Carla that when she's answering the phone, and can handle those questions for people, has really... I mean we have great online reviews. We have very happy customers or clients. And I just never really put that together in the beginning how big an impact. I was doing it to get my time back. But training her right has really made a huge impact on just how our business is perceived. And in HOA management, we're the bad guys. We're always the bad guys, but not everybody hates us. That's pretty good in the HOA world.
Anne Lackey: That is good. Because I don't know that we like you very much either as residential property managers.
Kent Grothe: Yeah, I know you don't. That's fine.
Anne Lackey: All those crazy things. So yeah, no, I get it.
Kent Grothe: Yeah. So I think that was the thing. Just the impact of having someone like that on the phone. And she is, I mean my VA, is a rock star. She is so great with customers. You just can't beat Carla. So I think I got your best one. So sorry everybody else.
Anne Lackey: I have all my clients feel that way. And a lot of them do so that... And they're perfect for them. That's what I say.
Kent Grothe: Yes, exactly.
Anne Lackey: Like your person is perfect for you. They wouldn't be necessarily well suited for somebody else. And I think, again, that comes down to my secret sauce of being able to find those right things. I think the good news about our processes, of course, I'll give you three. Anyone of those are talented enough to do the work. You can pick the one you like.
Kent Grothe: Exactly.
Anne Lackey: Does it get any simpler? Pick the one you like. And they're like, "Well, I don't know."
I'm like, "Well, they're all good. So pick the one you like." Well Kent, thank you so much. For those of you that are looking for HOA services in Atlanta, I encourage you to get in touch with Kent and his information is to follow right after this message. So thanks so much and have a great rest of your day.
Kent Grothe: Thanks Anne. I enjoyed it.