The Silicon Review
“We have made it stand practice over the years to spend at least an hour ‘interviewing’ a prospective client to make it clear they understand our roles and we understand their objectives.”
The PIP Group, LLC, founded by Charles Sells in 2004, began with just $4,000, lonefounder, and four potential investors, willing to invest $20,000 in a little-known investment – tax liens. Today, The PIP Group is known as one of the largest agencies of its kind, with more than 700 investors worldwide. The Group represents investors both large and small – with literally hundreds of thousands of transactions made for tens of millions of dollars every year.
The PIP Group is not a fund; rather, it allows investors to retain 100 percent control and ownership of their investments. The Group provides push-button, turn-key servicing on behalf of investors who are interested in passively investing in tax liens, tax deeds, traditional foreclosures, fix/flips and long-term cash flow acquisitions.
The model was simple: use Mr. Sells’ growing knowledge, integrity and tenacity to help others grow alongside him, in experience and in profits. One investor at a time, Charles has built a reputable business helping individuals invest passively in everything from tax liens to the ever-so-popular fix-and-flip. Fast-forward 20 years and The PIP Group has transacted hundreds of millions of dollars in distressed real estate investments on behalf of nearly 1,000 investors worldwide. Charles and his team at The PIP Group have taken the stress out of investing in distressed real estate, by enabling investors to have their individual investments remain in their name and their control, retaining 100 percent ownership, with Charles and The PIP Group team at the helm to make certain those investments remain profitable.
The company was incorporated in 2004 and is headquartered in Hilton Head Island, South Carolina.
In Conversation with Charles Sells, The PIP Group, LLC CEO
How successful was your first project roll on? Share the experience.
I started this business with nothing and it was a slow start. Being that our business focuses entirely on residential distressed real estate, we did not really take off and start to turn profits until 2008/09.
What challenges did you face in your initial years? What can your peers learn from it?
Our biggest challenge is and will continue to be the ‘re-educating’ potential customers. Contrary to what you see in late night infomercials and “reality” TV, investing in any facet of distressed real estate comes with a unique set of challenges. Whether we are talking about tax liens investments, or about flipping homes, prospects have to understand it is not easy and there are bumps along the way. The majority of prospects come to us, because they have either believed those pies in the sky pitchmen, or have assumed it is easy to do what we do and have gotten in way over their heads. A “re-education” that we do can be very profitable, but is far from as easy as it looks to be our biggest challenge.
Fostering a culture of feedback is crucial to the success of every organization. How is this true with your company?
I think managing expectations from the first interaction with a prospect, who then becomes a client, is crucial. Exceeding expectations is a far easier task, than have to back-peddle and eat your words. We have had clients in the past that I truly don’t think they had a clue as to what they were investing into. We have made it stand practice over the years to spend at least an hour ‘interviewing’ a prospective client to make it clear they understand our roles and we understand their objectives.
If you have to list some factors that have been/are the biggest asset to your organization, what would they be and why?
First and foremost, my staff and our contractors play a major role. Was it Richard Branson that said, “Treat your employees well and they will treat you well”? I hate when somebody refers to me as “the boss”. I am the quarterback of our team, but I am just one member of our team. I already mentioned it, but I think transparency is a major factor. Service Providers similar to us have a shelf life in this industry of six years. Why only 6 years? Because they have built their brand on false hopes and tight margins. The lifecycle of what we do takes about six years for those two components. It takes a very long time to build a brand and more importantly a positive reputation amongst both your peers and competitors within the industry. We work pretty closely with other top leaders in the industry, regardless of what field specialty they may be involved in.
Customer service varies, but companies can still be successful. How do you maintain your customers’ trust and loyalty?
Admit when you screwed up. I don’t want to keep beating the drum on transparency and managing expectations, so let’s shift gears a bit. I was moderating a panel a couple of years ago and after it was done, a man came up to me and asked what our fail rate was. Once I clarified what he was asking me (how often do we lose money on an investment), I said about five percent. The question caught me off guard because nobody had ever asked me how often we lose, but it was one of the best questions ever asked of me – we aren’t perfect and anyone telling you otherwise is lying through their teeth. As long as you double-down on the next deal, clients are going to respect the honesty.
As a question on sustainability, where do you see your company a couple of years from now?
The company is sort of on ‘auto-pilot’ right now, which is a great place to be! Something I do not tolerate from vendors, contractors, agents, or staff, is complacency. The next phase for us is to dial back in individual investors and dial up on more hedge fund placements. Those investors like their margins tight and their stress levels high – I think a few of them could benefit from a group like ours – maybe even add a few years to their lives. As far as sustainability, we have proven our model works in any kind of market, so we aren’t going anywhere, anytime soon.
The Brain behind The PIP Group, LLC: Charles Sells
Charles Sells began his career investing in tax liens at the age of 23. Like many of us, he was enticed by the simplicity and profitability often conveyed in popular coaching programs and weekend workshops. However, experience taught him that success required more than a simple snap of the fingers. So, at 26, Charles kicked the pitchmen to the curb and started his own business, helping investors discover realistic profits investing in distressed real estate.
“Our team of professionals has over 20 years’ experience and provides valuable education on the process and steps involved with tax lien investments, foreclosures, or any other real estate investment opportunity.”