Our Industry has Set You Up for Failure

Welcome back, Business Freedom podcast listeners. Man, I am pumped, beyond pumped about the message that I have today. If you are watching the video version of the podcast, you will see that I am looking a little rough. I am in my pajamas. I just listened to a sermon instead of physically going to church. I am coming off a 10 day or so trip where I was able to bless my beautiful bride, Julie. She turned 50 years old. I like to say I'm in my mid-40s. She just turned 50. I'm 46 going on 47, but I think 46 is still technically in my mid-40s and I'll take it. And she is more beautiful today. Just in case she listens to this easily more beautiful today than the day I met her, which was in 2005, February 2005. So going on 15 years from the moment I set my eyes on her. So we did not make it physically to church this morning. And the motivation to jump up into my office here and record the message was that I listened to a sermon online that really spoke to me in the one sense the way it was supposed to in my faith walk and how I'm showing up in the world and what's important and all of that. And then on the other hand, it really spoke to me that our members and those that are looking to, to actually build a business in the real estate industry, we're going against the grain when we do that. And I'm going to unpack that a little bit here in a second. So I go to Elevation Church. It's in Charlotte, North Carolina. My pastor, Steven Furtick, I've been going to the church for about 10, over 10 years now. Started went there for the first time, Mother's Day 2009. It's been an awesome just growth journey to watch something that has such a, an awesome mission just grow. We were at one physical location when I started. We're at 20 physical locations and they just have an awesome online presence and just they model excellence in everything they do. It's really, really awesome. If you want to watch the sermon, it's kingdom clout part two. Elevation Church, Stephen Furtick. They've got a YouTube channel. It's really, really good message and this is not to spread necessarily to share my faith and all of that. If you have a faith and you're struggling to spend time in that area of your life, I definitely encourage you to go online and hear the message. It was really awesome. The thing I want to share today is that the essence of the message was that the devil uses Discouragement and distraction to have us think that we're not good enough to do something good in the world or to have a relationship with God. Right. So, and the message was that, you know, if we could just keep you distracted enough by social media or things that ultimately don't matter, and if we can discourage you because you're looking online and everyone's, you know, what they're putting out there on social media is really not what their life truly is about. No one's really leading honestly in how they share themselves and even conversations, especially with men. Right. We're not leading with the challenges and the struggles. And let me like get into this with you and let me unpack the layers of hurt and where I'm slipping and where I'm not living up to, you know, what I should in different areas of life. We just don't do that as a society. So that was the message. The message was just one of like, you know, if we come closer into relationship and spend more time with God, you know, he's going to encourage us and he's going to keep us, you know, on the right path. So the application to business is, I feel like in our industry we are, it is just completely jacked up in terms of the things that we celebrate and the things that we focus on. And if you're caught up in what the industry promotes as success, you know, I call it traditional success or conventional success in our industry, it just really sucks. We only really measure top line, you know, so how many homes did you sell? You know, if you're a team leader and you bring people under your fold and you share your vision and you're all charging toward this vision. You know, it's a measurement of like, how many homes did you sell? And it's not a conversation about, you know, how did you show up in all the areas of your life that matter. If you've been following real estate B school for any period of time, you know, you will definitely understand that, you know, we want you to succeed in business, of course, and have that business fuel not only your life, but your team members lives and enrich your client's life and your community and all of that. We want you to show up in all the areas of life that matters. Bottom line, we do not. You know, I'm realizing more and more that my sole purpose, my reason for doing this and for showing up in every relationship every day is to help others avoid regrets in their lives, whether that's personally or professionally, just to help you avoid regrets. And so when I think about discouragement and distraction, and I look at how our industry measures success. You could only be, like, chronically discouraged if you're trying to measure your success against guys and girls in the industry that have achieved conventional success. So they're selling a lot of homes, but they're not sharing the truth of what that looks like in the other areas of their life, or they're not sharing the truth of what that looks like even in their business when it comes to their bottom line or how many hours that they're working and so leads to a tremendous amount of discouragement. And then the distraction that our industry puts on us in terms of just how we're even marketed to or, you know, the example that comes to my mind is that, you know, we have agents that are now getting into close relationship with, let's call it a Zillow, or any of the ibuyers think other ibuyers are aligning themselves with local agents to help them sell the homes that they're buying. And we see their average commission, they're all published, go from 3% to 1.4%, 1.5%. And I just know how hard it is to provide an amazing service to a client and still make a reasonable return. You can't do it on that. And so these businesses are going crazy in terms of the amount of units they're able to transact, the amount of closings they can have in a year. Yet all those team leaders are heavy in production. They're likely working 60, 70, 80 hours a week. I know some of them. I have conversations with some of them. I'm actively coaching some of them now. And our highest members of real estate B school. And so when you think about, you know, we're looking up to teams that are selling four or five hundred homes, yet we don't know anything about the team leader. We don't know anything about any area of their life besides the number of homes they sell. It's kind of like going on Instagram. When I go on Instagram, I just feel like I suck at everything. And I know that I don't. In my heart, I know that I don't. Yet you go on like an Instagram, especially Instagram. Everyone's putting out. I mean, I guess it's because it's just images, like you're putting out images that just shine the best light possible on you and your family and your life, and it's ridiculous. I've given up Instagram. I don't do Facebook anymore. I'm just done with all of it. And I just have a really clear idea the things I need to do on a regular basis to show up in the areas of life that matter to me. So that is discouragement. So if I'm looking at what conventional success or what our industry tells us conventional success looks like, I will be discouraged. I will be discouraged. There are guys that I know that sell twice the amount of homes that I do in their real estate team yet, which is great. And these guys are put on a stage and they're sort of put on a pedestal yet I know how many hours they're working, and I know their profitability. So guys that are working 80 hours a week, which is 4,000 hours a year, doing 4 or 5 million GCI, and their profitability is in the low teens in terms of profit. And so it's not good or bad or indifferent. We can help those businesses. We can help turn things around in a business like that. Just be really careful when you have conversations with folks that may be a couple steps ahead of you in your journey, what the conversation really is about, make sure that you're taking advice. And this isn't a pitch for real estate B school, although, of course, I'm super passionate about the models and systems and frameworks that we use to help you set this thing up foundationally. Right. This is not what this is. I'm just so worried. Even our own members get distracted and follow others and do webinars and go to events, and they get lulled into thinking that there's an easier way to build a business. And so you can get really discouraged. And then because it's hard, building a business the right way is really hard. It's really easy to get distracted. And so that's why folks can. Let's use an example of we have a member who, without, you know, consulting with their business coach, which is us, which didn't make, you know, us feel great, they signed up with a seller, lead provider. So it's an instant offer. Lead provider, $5,000 up front, $3,000 a month plus, I think, 25% referral fee. And if you know anything about anything that I've talked through on the podcast, I did a series on the financial. I forget what episodes it was. The financial implications of setting up a business the wrong way versus the right way. You definitely want to go back and listen to that. If you're sort of in this world of not having the thing set up the right way. So dropping $5,000 cash, a $3,000 a month or $36,000 a year plus 25% at closing referral fee. That wasn't in that person's business plan. That certainly fits no economic model that is sustainable in any way whatsoever. When I say sustainable, it means that you can build the business to be a business in and of itself where the owner doesn't necessarily need to be in production to make the numbers work. So it wasn't in their business model. Business plan for the year. It didn't fit their economic model yet. They were distracted. They were marketed to, and they hadn't checked any references. So they didn't. Weren't really sure that this was even going to produce the number of closings that they thought it was. It's that stupid old saying like, you know, we'll make up for it on volume. And there's a lot of folks out there that are falling into, you know, getting distracted by something that isn't going to get them where they want to go, which is a business that earns a reasonable return, where the owner can be a true owner in that they can lead, manage, and hold folks accountable, you know, lift others up in the organization to achieve at a higher level. So they're, you know, they're. They're creating voids in the. In the organization so that folks can, you know, achieve at a higher level and become the best version of themselves and they can ultimately impact their clients in their community. And I don't see that happening a lot of times because team leaders are continually discouraged and distracted. And so hopefully there is a message in this that gives you comfort. If you're going down the path of building real business to serve buyers and sellers at the very highest levels, like just the best provider of buyer and seller services that there is in the entire country. If that's your mission, I'm gonna be the guy that builds the business that is the best at helping buyers and sellers, not an agent that tacked on a few people and, you know, they call themselves a team, but it's set up completely wrong. And there's no standards whatsoever. There's no culture or cadence. I'm talking, you know, that all the shifts that are coming in the industry are going to decimate a lot of those weaker businesses, those weaker service offerings. If that's your motivation for building something that's better, then just take comfort in the fact that it's going to be hard and you're going to get discouraged if you compare yourself against the guy who did it in a way that led him into slavery. You know, I gave the example of, you Know someone who's not making more profit than their own personal production in a $4 million plus business and they're working 4,000 hours a year. I don't. You, I don't want that. That's just, that's insanity to me. And so you're going to look at something like that and say, hey, why can't I build that? You can't build it because you're doing it the right way, because you don't want that thing. It's quite easy to build a business that has no margin and no value. At the end of the day, if we extract a team leader from a business like that with marginal profit and they're still heavy in production, the business is worth $0. And I'm not saying that you need to build your business to be able to sell it. You need to have a true entrepreneur build something so that it has inherent value, right? You're building something to be a true asset, not just to be this really super stressed out job, right? You don't need to bring a whole bunch of people into your organization, take on a whole bunch of overhead to be able to not even make more money than your personal production. It's just insanity. Yet the industry puts a person like this on a pedestal and everyone around them does the same thing. How are you doing this? How'd you sell, you know, 500 homes this year? You know, that person's not saying, I did it because I have no margin in my business and I sell a lot of homes myself to make even a little bit of money, right? So really be careful. Really be careful who you're looking at in terms of getting encouragement or being discouraged. And then it's easy to get distracted. The things that will distract you typically aren't the things that are going to have you build a business that has a life of its own. A life that's what I call sustainability. So a business that has sustainability generally doesn't have a whole lot of sexy stuff in it. You know, it's generating a lead via your own marketing efforts, saying, you know, offering some type of value on the phone to get them to meet with you or text or email in a consultation, convincing them that you're the best option to do business with and making it risk free. Delivering on the promises that you made in that consultation in such a way where they're like blown away by what you guys do, and then closing that contract out the right way, where you don't lose the goodwill that you've built all the way up through the process. That's the whole game of real estate and the. And that's what you need to focus on someone that wants to build a business that has staying power with all that's going on. So just know that it's going to be hard. Know that distraction is the thing. In this case, I'll say the enemy is the industry. In the sermon, the enemy was the devil. The devil's going to use distraction and discouragement, have you looking at the wrong things so that you don't do the right things. So let's just summarize the sermon that way. And then in business, the enemy is the industry. The industry wants you to look at top line growth. They want you to look at or they reward top line growth they want you to succumb to. Zillow wants you to pay them 35% referral fees. Now when they close, you know, iBuyers want you to take on their listings at 1% and make no money. It'll lead you to more units and kudos in a traditional sense. And on the other hand, you'll be working way more hours, way more stress with no money to show for it, no time and any of that. So you'll be distracted by the things because it's hard to just provide an amazing service and get referrals as a result of that service. And so you want to create this virtuous cycle in your business where you're doing the stuff that others won't. And the byproduct of doing business, business the right way is that folks are going to say good things about you and you use that in the front end of the business to get more business. That's how we shifted our business over the last three plus years or so. So my friends, hopefully this hit you the same way that it hit me. Is that no wonder at times. And we're going through this in real estate B school now. I'll end with this because this is powerful as well. We're going through this in real estate B school is that what we stand for is not what the industry promotes. What we stand for is to build a business sensibly based on systems and the right people running those systems. Not a big business. It doesn't have to be a big business. Take your time to build the business the right way so it's good at helping buyers and sellers. And in doing that, it's just going to be a slower process than you want. You're going to be working on things that aren't very exciting. It's going to challenge you in ways that you haven't been challenged before. To step up and build systems and manage people and lead and inspire and cast vision and hold people accountable. And a lot of that stuff we're not trained to do, right? So we teach things in real estate B school that aren't the popular things. You know, there are coaching companies out there that teach, you know, you need every one of your agents, sell 10 homes, you get 40 of them, buy a whole bunch of leads and off you go. And there's, that's an easy way to do it. You could hire 20, 25 agents, you know, onto your team and spend $50,000 a month on Zillow and God bless you and God help you in terms of making a profit and not being super stressed as the person that's taking the risk in doing all of that. We've had members come in that came from programs like that that are teaching that exact method. And it's just not the way to build a long term, sustainable, profitable business that earns a really good return for the owner and also for the team members and serves clients and the community at a significant level. And so I know what this feels like. I'm feeling it now in real estate B school. I also knew what it felt like as I was scaling my real estate team because we were doing some things that were not popular. When everyone was doubling down on some lead sources and everyone was jumping into the instant offer messaging and we were jumping out of, you know, all the me monsters out there. I can do this. I can buy your home in seven minutes. You know, just send over, you know, a picture of the home and I'll give you an offer on it. Like when everyone was going that way, we were like, whoa, that is just ridiculous. That's not a long term sustainable business. Super gimmicky. And so, and it's not the easy route, I guess is my point. So this in the real estate team, it's always been sort of counter to what's going on in the industry. And now same thing in real estate B school. You know, we teach things that others don't teach because they're honestly not that sexy. And I'll say, if you want to have a business that stands for something that's going to have some staying power with all the crap that's going on, the only thing we can offer you is a conversation. There will never be a hard sell into real estate B school. You just know through what we teach, even if you're a non member, you know, if this is a world that you want to live in, and you're willing to do the work necessary to build a business the right way. And there's no way to sexy that up except just to say it. You know, we joke internally that, you know, for an industry, real estate agents, that, you know, they love rock concerts and french fries, we're peddling salads and green juices. Salad and green juice. That was a buddy of mine, Kirby, out of Minnesota, told me that he, you know, he came into our world when it was, I think it was just him and his wife and maybe a showing assistant and administrator. And they've, I think, almost quadrupled their business. I think close to 500 sides. They may have closed 500 sides this past year. And so that one is on Kirby, because he listens to the podcast. And I do not ever want to be accused of swiping someone else's stuff without giving them credit for it. At some point, Kirby, and I expect you to reach out to me when you listen to this. At some point, I will claim that as my own, the whole green juice salad stuff, the good thing about green juice and salads and true health in your physical body and also in your business is that everyone, if you really want to be healthy, you've got to go back to the things that are going to make you healthy. And it's just tool systems and strategies that have you build a sustainable business. So back to my point. If you are. If this message is hitting you in a way where you're like, gosh, that's why I feel so discouraged and that's why I'm so distracted all the time. All we can do is have a conversation. Just go to realestatebschool.com There should be some button that says apply now or look into our pilot program or there's a way to engage with us. There's. You'll read about what it looks like and who our best members are, what they look like, and then a short application to make sure that we're a good fit for even just an initial conversation. So if that's you, go to realestatebschool.com and I love you and I respect you and I hope someday I get to work with you. And if it's only through this podcast, that is totally cool, too. But if you're ready for the next step, go to realestate B School. Com. We'll talk to you later.