It's Possible To Scale a Team Without Sacrificing Your Personal Life w/Jonathan Popowich

All right, welcome back to Real Estate Team Biblos podcast. This is going to be an awesome episode. We get to hear from someone who I've known for, I don't know, like, three or four years now, Jonathan Popowicz. He runs a monster business in Kannada, which is just north of the United States. You guys haven't heard of it. And he crushes it in multiple areas of life. And so that's really what I love to highlight on Real Estate Team Builders is guys that crush it in business and they're doing right by their family in terms of being a good husband or wife, and then they're still showing up for their kids, and they're just doing all of it. And so, Jonathan, I would love for you to kind of give a little bit of an intro, like the teaser. Why would we listen to you, your production, like, how many hours you work, what's your vacation look like? Give us a little bit of something to pay attention here.

All right, thanks for having me, Lars. Yeah. So I am married to the most patient woman in the world, and we have four children. This year, we are going to be doing about 190 ends, total volume in around 180 million. And, you know, I live a great life. So I work about 40 hours a week, Monday to Friday, weekends off, evenings off, and lead a very strong group of agents on my team.

Awesome. How many agents on your team?

We've got four agents.

Awesome. So you run a pretty lean and mean team. And when we, when we were. Before we hit record, we talked about, like, hey, what's the one thing we can do to serve, you know, to serve me and our listeners here on Real Estate Team Builders? And it was this, this concept about, like, what are you building? What are you doing? Why are you doing it? You know, in our industry, we're so focused on growth, more often than not for growth's sake. Like, there is no real reason or thought or rationale. It's just like, I'm just going to sell more homes, more homes, more homes. And then we don't look at the collateral damage. We don't think about, like, economic model and is it going to end up in a good place and all of that. So we're going to unpack, you know, what are you building? Why are you building it? I'm going to let you chat about that a little bit. Your own personal experience with that question and how maybe, you know, I challenge you a little bit in an area and then we're going to break down the economic model and all the little considerations around it. But talk a little bit about that. Like, when did you come to the conclusion? Because you got into real estate, I think in 2010, and you started building your team in 2015, but when did you really have the moment where you were thinking to yourself, like, what am I building? Why am I building it? And what were those questions you were asking yourself?

Yeah, so, like, when I started as a realtor in 2010, I was a firefighter. I was a professional firefighter here in the city of Calgary. And so I was doing 48 hours a week at the fire hall, at least that, doing real estate. And it was good. I mean, it was something that. It started because I was flipping homes, and that was really the reason why I got into real estate. But after we had our third child, I realized pretty quickly that this was just not sustainable. Like, there were not enough hours, even though everybody has the same amount of hours in a day. And in a week, I just felt as though there wasn't. There wasn't enough time in a day. And I would literally go from being at the fire hall to working with clients, back to the fire hall, working with clients. And even though I was in the same city, it would be like two or three days before I would even see my family sometimes, like, just insanity. So I think it was a bit of a perspective shift where I realized, like, hey, you know what? This is? Something's got to change here. So I actually took an unpaid leave of absence from the fire department. We were building a house at the time, and I thought this would be a good time to get some clarity, kind of figure out what the heck am I doing, because this isn't sustainable. And so while I was on an unpaid leave, of course I needed to continue to earn some money. So I got a call from the chief and a letter saying, like, hey, you're not allowed to work while you're on an unpaid leave of absence. You need to come in and talk to us. So essentially, I got called in, had to dress up in my number ones, and essentially they were giving me an ultimatum, like, what do you want to be? Do you want to be a realtor or do you want to be a firefighter? Which made the decision pretty easy. You know, I have a mad respect for my emergency services family, and I love that job. Still to this day, think that being employed, it's the best job out there. But in terms of being able to do something with a purpose that I was looking for, being able to grow something, not have this glass ceiling, real Estate was kind of a natural fit. So, so I jumped in two feet doing that and I realized that I just had the same problems. The time was still filling up exactly the same way, just doing different activities. Maybe I wasn't fighting fires, but maybe I was showing buyers or who knows. So in 2015 was when I. Late 2015 was when I looked to get some help to think like, I'm not the only guy that's trying to do this. There's probably people that have done this before. And so I hired a coach and the coach was good, helped me put a couple things in place and hire an assistant and do some small scale stuff. But then it turned into ultimately just more production and getting busy again. So it was in 2018 when I met you that that was kind of the big game changer for me in terms of really looking at the business and deciding where am I going and how am I going to get there.

And so as you're sort of contemplating, you know, 2015 to 2018, where were you in 2018? You know, what does your production look like, what did your hours look like and what were some of the questions? Because your kids are young, right? How old are your kids?

Yeah, so my oldest boy is 13. So 13 year old boy and then I have a girl at 10 and then another one at nine and then boy at six.

Okay, so 13, 10, that's a lot of kids.

Dude, I totally screwed up. See, this is, I'm distracted. It's 13 year old boy, 9 year old girl, 8 year old girl, 6 year old boy.

Your kids are going to be listening to this.

Be like, dad, I know, yeah, I promise you I'm a present, dad. Even though.

So 2018, describe the situation and what questions are you asking yourself at that time? Like what needs to change? What's out of bounds? Are you having conversations with your, your, your spouse? Like what, where are you? Are you, is your physical body like, you know, not where it needs to be? Your, your spiritual journey, like what was life like at that 2018. And then we'll get into some of the decisions you made.

Yeah, I was, I was actually part of a men's group at the time. And, and we, we have this, you know, the concept of margin, like having margin in your business, margin in your life, margin in your relationships. And I was just a guy running with like zero margin, always on 100%, going on vacation, doing deals, may come together, may not come together. Always distracted, not being in the moment. You know, if I'm being very honest, like the Date nights, where you go to the washroom to check your phone, like, that kind of thing, and you don't want. You don't want your wife to see you negotiating a transaction while you're on date nights. But, yeah, like, that was. That was me. And it just was not. It was not sustainable and not scalable. And I was just thinking, like, I'm a young guy. I can't be doing this forever. I'm gonna burn out. And sure, the money is good, but at what cost? Like, if I don't have anything else going in my life, it's just not worth it. So, yeah, so it was actually when I met a buddy of mine here in Calgary, Joel Anderson, and he's like, dude, you need to talk to Lars. He's doing something a little bit different. Like, every coach is just production focused. And this is. I know this is a large plug here, but legitimately, it was something where I came in skeptically just to see, like, is there another way of doing this? And then that's when things definitely changed for me.

Awesome. And so what? So you were just out of bounds. And I've been there, so there's no. There's definitely no judgment. I have been in the. In the bathroom not having to pee at all. And I'm just literally getting a deal done or even responding to a lead. When I was the only one working my lead gen platform, I'd be like, speed to lead or whatever. The saying is, like, this $10,000 and it's burning. So, I mean, every evening, every weekend, was it. How bad was it? You know, you were working buyers and sellers. Tell me a little bit more about it.

Yeah, buyers, sellers, like, whatever business made sense and even business that didn't make sense, like, it was every opportunity I would take it and run with it. And, and, and really, when it came to building a team, I was building a team selfishly, if I'm being honest, where it's like, you know, help to sort of support in, like, buyer agent activities or things like that. Not really thinking that maybe there was another. There was another way to do things. So, yeah, you nailed it. Like, I was up before everybody in, working until 11:30 midnight, every single night, up again at six in the morning, working. And, like, I was just waiting for people to wake up so I could negotiate with them, basically. That's awesome.

And so fair to say, like, 70 plus hours a week, easily.

Yeah.

Okay, so let's. Let's call it 80. So you went from 80 hours a week to 40 hours a week. You'll do 180 million this year. What kind of volume were you doing three years ago? Similar volume or was it less or way less?

I was doing probably only about 75 million in volume.

Yeah, man. We could do like, multiple episodes on just that. Right. So how do you, in three years go from 75 million 80 hours a week to 180 million 40 hours a week? And we're not going to, like, we'll break down some of that because I think it's going to come out some. In this conversation, you know, before I hit record, I asked you the question, like, what was the big driver? You know, as you look at the 2018 world to this year, you know, the more than doubling and bringing your hours in half. You talked about economic model and like, the different, like, three or four numbers that you had to wrap your head around. But not just numbers, like, in the business, what am I spending money on? Marketing or my administrators or overhead or cost of sales. So as we're unpacking this, like, is there anything else you want to talk about before economic model or you want to jump right into that?

I think we can jump right into that. Yeah.

Yeah. So when. When we started working together, and this isn't the Lars show, so. So I will. Because Jonathan did. Did all of this. What was. Did you. How did you come up with your splits? What did the economic model look like? Did you have any vision of where you wanted to end up in the future? Tell me about where you were.

So, yeah, Lars, I'll never forget, like, I had you. You've got just an amazing group of people. The economic model at B school. And so I had my first kind of discovery call with you. And then I'll never forget, I had a call with Andy Mulholland. And this was the first time I'd met this guy. And he starts asking me these questions, and this is in 2018. And he was able to pull out snippets of my business and the questions that he was asking me that I honestly felt like after 10 minutes, he knew my business way better than I did. And I thought, this is a big problem. But it was through Andy and the way that he had kind of explained. Maybe it was just the way that we kind of understood each other, maybe, or something like that. I looked at Andy as a mentor in a lot of ways, because he broke it down to say, like, look, this is what's happening. This is the way that you're going. This is what the end looks like. We have to change this. And this is what happens if you don't change it. And so it went to like stripping the business right back while we're still selling and doing the day to day activities. But this idea of let's kind of focus on three years out, let's talk about the next year and then let's actually break this thing up into quarters and say, what are the small little bite sized steps that we're going to do right now to try and change your business? And so there were some very real conversations that took place in that. And really just understanding that economic model, to me that's the foundation to the entire business is if you're not working on the right economic model, yeah, you can spend a ton of money on leads and you can sell a ton of houses and you can pay your agents a ton of money, but at the end of the day, what are you doing it for? And is there anything left over or are you even making any money at that point? So it was really just looking at what can we do right now, what's one small step in this big pie and then we're going to do it again in 90 days and do another step. And that's what I've been doing and that's still what I'm doing right now.

Yeah, let's spend a little bit of time on that. And then I want to get into the different numbers that you had to have an awareness around in your business. It's the 3, 190. So it's looking out three years into the future. And I do this in multiple areas of my life, but in business, declaring today what you want your business to look like in the future. And it's a rolling three years. Every year you're looking three years out. And so it could be the position you have in the business or how do you get from. You could be doing 40 sides today, but you want to be doing 200. And how do you need to actually build it out, anticipate what's coming and then one year break that three year down into a one year plan. Like really what has to happen this year? So you're a third of the way to your three year vision. And then you break it down into quarters and then weeks and then days, and then really hour by hour, half hour by half hour. Are you working on the things that are going to help you have the kind of day you want, the week, the month, the quarter, the year. So you're going to end up at the destination, same thing in your physical body or in your Marriage or, you know, whatever area of life that you want to succeed in. So I want to just go little bit deeper on that. So people knew like how that all works at 31 90. Let's talk about economic model and let's talk about like the conversations and the decisions you needed to make, you know, in relation to the team you were building, the agents you had splits with, your marketing, your administrators. Unpack that for us.

Sure. Yeah. So I mean that's something that I think as a team leader is always. The is is. It's always in your mind. Right. You're recruiting agents and a lot of agents, not necessarily the right agents for your team, but a lot of agents. The very first question they're going to ask you is, oh, what are the splits? Right. They want to know what are the splits? But having this, this mindset of like, yeah, the split is just one of the forms of remuneration and being on your team, it's what, what other values are you providing to your team? So it's again, to quote you guys, and I've heard multiple people at B school say it, it's not a splits issue. It's. And so looking in the mirror to say, like, what are the value adds that my team is going to be able to provide to my agents? So let's take Donna on my team. Like, awesome person. I love her. She was my very first buyer's agent in 2015. She's been with me. Even today she's still with me. And there's been ups and downs and I've changed her splits probably three times. The poor girl. But this last time around, when I had my agents to say, oh, hey guys, we're actually going to be paying you less, we're moving to something called a value based commission split. Obviously that conversation isn't something that anybody's really excited for on either side of the table. So that would be probably one of the most difficult conversations that we had that I was thinking was going to be the most difficult. But it actually turned out to be one of the best and easiest conversations.

Yeah. And there's so much goodness in what you just said. So the industry revolves around this idea of splits and we're all competing with brokerages that give away whatever 100%. Right. How do you compete with someone that gives away 100%? It's because you've put the systems in place to allow them to sell more homes in less time with less stress. And this concept of value based commission splits. I want you to explain what. Because I Can rant on this forever that like, hey, Listen, there's a $15,000 commission check here and it's my best friend buying the home and you're going to have five hours in it and you're complaining about the, like, you want more. Like, you know, you want to make more than $1,500 an hour on this deal. Like, are you kidding me right now? So how do you think about value based commission splits? Because I'll just piss all team leaders off by explaining it.

Yeah, it's exactly what it's called, value based commission splits. So the value that the team member is bringing with that lead or that transaction, they get compensated accordingly. So if it's their sister or their best friend or their direct sphere of influence who's coming into the business, that means a higher split for the agent, which also means lower cost for the business to be able to get that fee. And so that's basically the way it works, is that the more involved that the business is to get that signed appointment or that signed client for the agent, that's where more pay would go directly to the team as opposed to the agent. And so of course, it's a direct relationship of how much effort the agent would be putting in to essentially sign that client as well.

Yeah. And it's sort of a vicious cycle because if you're on the wrong economic model, you're unable to provide the promises, the value, and then you're forced to stay in production more to make the kind of money you want to make. And so you're less available to your team to coach them and mentor them. And. And then it's this weird thing where like, you're super stressed now, you're like selling more homes than they are and they're not doing the thing. And it's just this resentment pot that keeps stirring. And so the only way to do it is to declare that I'm going to serve you at the highest level. To do that, I need to pay, like, reasonable margins. I need reasonable margins in my business so that we can grow this thing together. And my promise to you is that you're going to take home more money. Trust me that the percentage is not the thing and you're going to make more money. Anything to comment on there?

Absolutely. That's just it. And I think that the other thing is it takes the right agent to understand that, to have that sort of foresight and understand that, hey, look, Jonathan is, you know, he's selling 100 homes this year personally himself, but he wants to be out of production in a year or 2. That means 100 more deals based on what our business is doing today and our business is continuing to grow. That's a hundred more deals that us couple of agents are going to be able to do together. This past summer was a perfect example of one of the times where I didn't have that temptation to go back into the buyer business to go and do that deal because we had a gimme transaction. We sold their house. It was a listing, probably about a million bucks for the listing. They wanted to go and see a $2 million house. And I had no problem in saying to one of our team members, hey guys, here's a gimme deal. Go and sell them this house. First appointment, they see the house, they write an offer. It was a home run for everybody. And I didn't feel at all like, oh, if only I had done that. Meanwhile, the agent was thinking, this is awesome. You know, it was just a great experience to see the value based commission model in work.

Yeah. And real estate B school. We actually teach, we teach a model that pays out more than I actually ran my team on because my team was so aggressive in terms of like, we're going to take everything off of your plate and we're going to pay the lowest splits of anyone I know in any state, in any province of Canada. You know, and you just have to trust. And our top agent would do 300 plus, you know, take home. And he worked hard, about 55 to 60 hours a week, but he took home 300. And he had no risk, no overhead, cell phone bill and MLS dues. You know, so it's, it's, it's obliterating this concept of you're competing with other brokerages on splits. Right. Because you're competing with somebody that their average agent sells seven homes. And that's not what we're doing. All right, so, so, so that's cost of sales, right. Gross commission, less what you pay your agents and the decisions you make, value based commission splits. And now under that, what do you want to talk about with marketing, administration, overhead. Like everything else is, you take out everything else and what's left over is profit. What other awarenesses did you have around the model you were running and maybe what you're running today?

Yeah, so I think for me it was really drilling down on the expenses category and understanding the overhead, the marketing and salaries or people expense. And I think we as realtors have that tendency to hit the easy button, throw some money at something, hope that it means a whole bunch More leads. But to really dissect and understand where are we getting this business and is there a better way to get the business? Like if you look at this online space or a number of realtors that have built fantastic websites, they have excellent organic search engine optimization, they're getting a lot of traffic, a lot of leads, and all of a sudden something changes and now those have dried up or some other player comes in and starts throwing more money at that particular source, their leads end up drying up. And that's not sustainable to me. I mean that's an outside factor which is a direct threat on your business. So something as simple as like database marketing. Right. Your most inexpensive and most effective source of marketing. And so why not double down on something like that? So that was a big piece for me, was just really understanding our marketing dollars, what has the best ROI and doubling down on those sources. Staffing is another one. Right. Like, I think some people may think it's sexy to have this big, huge, massive team with all sorts of different positions and salaried people and everything else. And that's not the case. Like again, as long as the jobs are being done and they're done to the standard that you have to your expectation, why take on any more risk, any more expense anymore? Anything to do the same thing. So just having super efficient people working in the right seats is what it's all about.

So how many administrators do you have servicing at different points of the transaction? You're 180 million or so of volume.

Yeah. So right now we have three. We had two for the longest time. This year we have a third. So we have a listings coordinator and we have an office manager, closing coordinator and then we also have an operations and relationship manager.

Awesome. Yeah, that's about what we're seeing. About 50 to 60 transactions per administrator. Yeah, that's what we see across well run teams. I see some that are like one administrator for 40 agents, but they're not providing any value and it's just a complete crap show. So that's a good ratio. And it's funny, as you were saying that and I'd never heard it said that way. Um, but the reason that we got out of paid leads years ago, so a multiple hundreds of deals per year team got out of paid leads and then ultimately decided to get out of mass media radio, I mean Zillow in our market just decided over a course of 3 years to 5x their prices. So like the whole industry is captive and now realtor.com is doing that. They're like, oh, we can just raise prices however much we want and we're not going to, we're going to make more money and we'll have agents behind that agent that might drop out and get pissed off. Like so, so you think you're marketing, but you're not marketing. You're paying someone money that's a better marketer than you, right? So this, The Zillows and realtor.com have just convinced us that that's marketing. It's lead gen to pay them money. But then also with radio, we had a guy, I've got two guys in our market that are willing. One's at $150,000 a month on TV and radio and the other is multiple six figures. He came in from another market, Mark Spain, he's selling 3,000 homes in Atlanta and he instantly went to five markets through a financial backing. So a zero profit model. And like, you know our, we were at 18,000amonth in mass media. And then we just got, we had been tracking it, it'd been going down year over year and it's not a profitable model. And so to the other point, talk about tracking a little bit. You know, how have you, how do you, how are you using tracking now? Maybe where you weren't in the past, how important is knowing your numbers, becoming the CFO of your business?

It's very important. And truthfully this is, this is a weak spot for me and something that I, that I need to grow in a lot. And we're trying right now to put some of these things in place. But if you, if you were to just look at something as simple as a signed call, right? We all get them, get the signed call they want to see. One of your listings goes out to somebody on the team, however that ends up happening, or whatever that process is, the agent goes and shows that property and then who knows what happens after that, right? Unless they buy that house, you don't really know what the heck happens after that. So for me, tracking with the agents is very important. So they have a weekly accountability form, just a simple Google form that they put every, everything in. We're talking about appointments set, appointments met and then signed, how many, how many of those end up as signed clients? And then at the same time, I want to know like if you, if you met somebody, you set that appointment and they didn't show up, what happened? Or if you met somebody and they didn't sign, what happened with that person? Like, are they still there? Are we still working on them? Or was it one of These people that ghosts you afterwards. Right. So as they say, and there's so many cliches I'm throwing out here, I feel bad about that. But there's fortune in the follow up and there totally is. And I think that the numbers that we're tracking, that is your follow up.

Yeah, that's awesome. When you look at most teams that are in the process of, you know, 100, 150, 200, 300 transactions, and many of them don't, they have no lead management or lead accountability or lead tracking or any of it. And so there's all these holes in the boat. Like such a good example, like one sign call handle properly. You know, if, if, if all you had and you dumbed the business down, got rid of everybody and all Jonathan had were sign calls, you'd sell 50% of them, probably. Right. Because you have to feed four kids. Like, you know, like you're, you're good at the, at the craft of conversion and, you know, follow up's important. And then when you scale, a lot of those systems aren't in place. And it's the least sexy side of anything in business. Like, who wants to make sure that every lead is called four times in the first day and texted, you know, four times and sent an email over bombbomb and then, you know, whatever, whatever else you subscribe to. All right, so we've got a couple minutes here, and I want to honor your time. And this is not the EXP show, so I don't want anyone to think this is a show to promote exp. But when I have someone on that's playing the game of real estate at Jonathan's level that has pivoted into exp. I just want to hear, you know, why the pivot into exp? What have you found since you've been in? Give me a little bit, a little bit on your decision to join exp.

Sure, yeah. And so I'll share this for the, for the benefit of everybody else. But you and I, you know, we've got sort of an interesting path with exp. I remember when you, when you made the switch a year ago, pretty much, I think, I think was a year this month you made here I am like subscriber to B school and we have this great relationship and everything's cool. And in my market, the way that it had always been presented to me, I just quit B school. Like, I did not have the time of day for anybody to talk about exp. And I thought, even though you hadn't put it out there, I knew it was coming and I was just like, I'm out. So I quit EXP and B school. Sorry, B school, yeah. And so my wife, who's like way smarter than I am, she asked me the question at Christmas time last year and said, you know what? Lars has, like, he's totally changed our lives. The least that you could do is understand why he went to EXP and then you can make your decision as to whether or not this is for you or not. So, like, quietly, without telling anybody, I'm kind of researching EXP and looking at it and truly studying the model. And then it was at that point that I realized, like, holy smokes, I think I've made a huge mistake here and I need to look seriously at this. And for me, it wasn't like it wasn't the Rev share piece, it wasn't the stock, it wasn't like all of these things that EXP and some copycats are offering. It was just the brokerage itself. So the brokerage as a whole is unlike any other brokerage out there. Like, I'm convinced I could be at any brokerage and sell a whole bunch of houses like that. That's not a problem. And I've done that before and many people have done that before. But the thing is, is I think that the brokerage model is flawed in a lot of ways. You're kind of renting your space, you're doing your transactions, you're on this transaction treadmill. You know, as soon as you stop selling, then, then things are done. Or if you have a key player in your business and they decide to leave and go start a different team, now you're in direct competition with them. Whereas exp1 of the biggest things that I appreciated was that it has this platform where it's built on collaboration. So essentially by me working with my agents and training them to run a really high performing business for themselves, if they decide that they want to go and continue on with that business and start their own team, that's awesome. I have a direct benefit to help them in doing that and I would look forward to seeing their success in the business in doing that. And so that's something that was just a bit of a game changer for me, in my eyes was like, there's people that are like, I'm going to be doing this anyways. Why not do it on the platform that just kind of promotes this collaboration? And by the way, there's also some pretty cool things that I'm just equipping my agents with. If they decide that they want to. You know, if stock speaks to them, cool. If Rev Share speaks to them, cool. If that's something that speaks to me one day, cool. You know, there's just a lot more opportunities as opposed to put your head down and sell real estate, which was pretty much every other brokerage out there.

That's awesome. You know the part of that story that I didn't know? I didn't know that it was your wife that said that said that. You hadn't told me that before. I love that. I want to send her a gift now. We get to partner forever together and help you build something amazing. So I would say if you're like Jonathan and people are going, you know, into exp and they're kind of coming at you crazy, and you want to talk to somebody who's not crazy and running a big business, I would reach out to Jonathan directly. And then if you're at the point in your business where maybe, like, you want to grow, but you really don't know how to grow, I put together a report. Six stages of growth, everything from under 100k to over 3 million, and what the journey looks like. Just go to Real Estate Business growth. I think that's it. Real EstateBusinessGrowth.com and pick up a free copy of the Real Estate Business Growth Navigator. Jonathan, appreciate you and your trust in in me. And even though you dodged out of my world, now we're back in each other's worlds and we get to build something special together. So take action. Go to realestatebusinessgrowth.com and we'll see you guys soon. Be good.

Right on. Appreciate you, Lars. Thank you.

All right, talk soon.

See ya.