At an age when his friends were busy hanging out and knocking back beers, Nick Karadza was flipping houses. “I started investing when I was 21 years old—probably too young to know any better,” he recalls.
Without much by way of real estate knowledge, Karadza bought and sold a property, making “a few thousand bucks” off the deal. It turned out he had a gift for the trade. After getting his real estate license and partnering with his brother on a few properties, Karadza co-founded Rockstar Real Estate, a brokerage that works primarily with investors. The Oakville, Ont. company took the #174 spot on the 2015 PROFIT 500 Ranking of Canada’s Fastest-Growing Companies.
By his own admission, Karadza isn’t your typical realtor. “If someone told me, Hey, I like the home but the carpet is the wrong colour,’ my reaction wouldn’t be what a good salesperson would say,” he admits. “My reaction would be, Well just change it.'” Instead of trying to be all things to all people, as he says many realtors are wont to do, Karadza chose to focus on a very narrow niche: residential real estate investors.
Just as his friends hadn’t understood his early foray into the space, so his real estate peers were skeptical of Rockstar’s singular focus. “We had people in the industry telling us we were crazy, [that] you need to list properties or you can’t really build a business,” Karadza recalls. But focusing on buyers who are investors at heart helped the company build a valuable reputation as a specialist in its area.
Even within that niche, Karadza is selective about who he’ll work with. Here’s how Rockstar vets potential customers and why having fewer clients has allowed Karadza to build a bigger business.
1. Find a gap
Early experience flipping houses meant Karadza didn’t have to go searching for a niche need to meet—he’d already identified one. “We took some real-estate training classes and paid a chunk of money for [them],” he recalls. “Then we tried to take those lessons that we were taught and implement them in the real world, and it was quite difficult to do that.” Other aspiring real estate investors were probably having the same experience, Karadza realized. So he focused on helping them.
A similar strategy can be applied by anyone in business: look around and identify the gaps in your own business or sector. “Are there consistent themes or frustration points that you’re seeing from people that you’re working and dealing with on a daily basis?” he asks.
A common pain point that any business can solve is implementation. “People generally want results without having to do the work,” Karadza observes. Offering to actually install or implement the services or products you’re selling is a great way to expand the amount of business you do with your clients and to make them happy.
2. Test your hypothesis
A good idea alone isn’t worth much. Early on, Rockstar ran marketing campaigns targeting the kind of people the company was looking to work with. When those efforts received a positive response from prospective clients, Karadza knew he was on to something. “But if we ran some marketing campaigns and there was no response, then maybe it was a sign that there was no demand in the market for what we were offering,” he says.
3. Limit access to your expertise
Most businesses worry about having too few customers and prospects, not too many. Rockstar is not among them. Prospective clients must join a membership program to get access to the company’s brokerage services. “Unless they [are] an active paying member, we [are not] going to invest time with them and work with them as client,” Karadza explains. “That really narrowed down the number of people we were working with.”
Rockstar isn’t interested in exclusivity just for the sake of it. “We realized that many people would gladly use our time and not be as serious as we would have hoped,” Karadza explains. And there’s no better indicator of seriousness than cash—hence the membership program. “We could focus more time on a smaller number of people,” says Karadza. “[And we could] provide those people more services.”
It’s a brilliant approach to separating the wheat from the chaff, though one that would probably seem outrageous to the average business focused on selling to as many people as possible. “It’s a little bit outside the box—I’m not sure if everyone’s a huge fan,” Karadza admits. But limiting its client list has worked very well for Rockstar, allowing it to expand its service offerings and property catchment area.
4. Do the right thing
Early on in his entrepreneurial career, Karazda read a lot of business books that focused on creating win-win scenarios. “I kind of thought that was a little airy-fairy,” he recalls. He was also aware and skeptical of motivational speaker Zig Ziglar’s maxim that if you help as many people as possible, you’ll get whatever you want. But experience changed Kardaza’s perspective. “I learned that those things are actually true,” he says.
Karazda believes too many people focus on the “how” of making money. “If you can figure out how to help the number of people that will allow you to make a hundred thousand dollars, that’s going to get you further, faster, than focusing on the money first,” he says.
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