The Framework for a Successful Business

Hey there. Welcome back to the Business Freedom Podcast. This is Lars Hedinborg, founder of Real Estate B School. And this is the Good, Bad, Ugly of Building a Real estate Team edition of the Business Freedom Podcast. Welcome to another episode. This is just an opportunity for me to rant a little bit about our industry. What's what I love about it, what I don't love about it, what is going to change and what I think the implications of those changes will be for traditional methods, traditional agents. And I am obviously biased in terms of, I think on the other side of all the financial players coming into our industry and the technology disruption, I think the only way to survive as a team is to build a high performance real estate team. And so let's get into it today. I want to talk about a little bit about something that I was introduced to early in my journey. And it was, you know, when I got into the real estate industry, I knew really quick that I wasn't going to be in production for a very long time. So that was something I was pretty clear on. I had a young child at the time. Anders was born in November 2007. I got into real estate, left my corporate job March 5, 2007, and I hustled. I hired my first buyer agent the fourth quarter of 2009. So for what, 2008. So two and a half years it was me. And for about a year of that I had an assistant and I hustled, man. I figured out a way to get busy. But at the heart of my involvement in the industry, I knew that I was going to bring a business approach. My background was in business, so I like to call it, you know, I was an entrepreneur trapped in the real estate industry. And I don't mean trapped in a bad way, right. Because it's an amazing opportunity to be in this industry and be able to build an actual business.

Right.

Our industry is full of even traditional teams. They're really not businesses because the business owner is just locked down in the business. They can't there, there is no freedom. There's no time and money freedom. If they went, left their business for, you know, 60 days, I think that's the true test of business ownership. If you left your business for 60 days or if you went down to one day a week, what would the business look like? Is it really dependent on you or is it an actual sustainable business that has repeatable processes inside of it? So I want to talk a little bit about, you know, what makes an entrepreneur different. So if you're in the real estate industry and you sort of feel like you're not fitting, you know, really well with the agents in your office or you know, those that love working with buyers and sellers. This may be the key. So number one is that we always have been self motivated by a bigger and better future vision of ourselves.

Right?

So I'm always three years out. I'm always thinking, even when I got into real estate, I was working with buyers. My first two and a half years I was 90% buyers. I didn't see myself as a buyer's agent. I saw myself as running a team and hiring buyer agents and then, you know, becoming a listing agent. Then when I was a listing agent, I always saw myself as the next iteration, backfilling, you know, building the system and then back filling someone to run the system. That's everything I've done and I continue to do in my business. Business is now I do with that, you know, eye toward building a system, stepping out of it, having someone step in and run it for me. So that's number one. Number two is we're increasingly, increasingly ignore other people's standards and images of personal success. So as entrepreneurs, we're not tied into what other people think of success.

Right?

So there's no traditional status quo view of success if you're really an entrepreneur. So when we commit to a season where we're going to work, you know, an ungodly amount of hours, it's because we're not, we don't see the world in nine to five terms. It doesn't mean that we want to give away our time forever, but we're willing to put in the effort and the time and the resources it takes to build something special. That's number two. Number three is our own personal experience. You know, our wins and our setbacks, you know, they're always more useful and instructive to us than following other people's advice and examples. So as entrepreneurs, we're constantly, first of all, we're going really, really fast and for the most part, we're failing faster than others. You know, the wins and the setbacks serve as R and D research and development for everything that will come in the future, in our future, personally and professionally. Number four is entrepreneurs increasingly approach their future as an exponential gain that keeps jumping to higher levels of personal challenge, reward and enjoyment. So even you know what, this year I'll have about six and a half, $7 million of revenue between my two businesses. I still know each of those businesses are probably $50 million combined in revenue when they're ultimately built out.

Right.

The impact that real estate fee school is going to have in the real estate industry is profound. That's a 10 to 15 million dollars business. I'm quite sure of it. Just because of what we do and how we do it a little bit different. High performance real estate advisors. Our goal is a billion sold in real estate by the year 2027. And we're doing all the right moves and we're winning and losing every day, failing fast in that business as well. So it's always an exponential gain. I want to talk about, I want to spend a little bit of time here talking about the framework of your business. And when I first got into real estate, one of the first books I read was Michael Gerber e Myth. And it really affected me, impacted me in a big, big way. In the book he talks about our franchise prototype and in this model that he presents in the book, he wants you to answer the question, or at least consider the question. If I were going to replicate my business 10,000 times, how would I have to think about it differently? So that is worth writing down. If I were to replicate my business 10,000 times, how would I have to think about it differently? From that perspective, you have to create systems that produce the results consistently and efficiently because you can't do it all and it has to minimize people dependency. A small business can run on a rockstar admin and a rockstar, a couple rockstar buyer agents and you're the listing agent. If you really contemplate building a business that gives you freedom, you have to think about it differently and it has to be systems at the same time. You have to liberate your team to do the work that really matters.

Right?

So it's not just working with buyers and sellers. It's implementing the systems with care and competence for your clients and first of all building those systems and then ultimately running the systems. Bottom line, systems are dynamic. You can't simply put a system in place. I talk a lot about systems in real estate B school and some of the training that we do. You can't put a system in place, sit back and just let it run forever. It's a continuous improvement process and there will be bottlenecks and roadblocks. And that's part of this never ending making it better thing that we work on when we take an approach in our business to. Well, when we go from practicing real estate to building a real estate business, there's four roles of leadership I want you to keep in mind. And this is regardless of if it's just you right now and you want to scale and build a real estate team, or if you're running a real estate team, number one is that you are the CEO where you're creating a vision for the company and a culture of ownership, meaning that the team members feel like they're part of what you're building. That's number one is the CEO, the Chief Executive Officer. Number two is the cbo. It's the chief Brand Officer where you're the champion of the brand within the company and the customers and potential recruits to your business. That's number two, chief Brand Officer. Number three is the chief Operating officer, coo, where that's creating the right balance between people and systems. And number four is the cfo. And this one, sadly in our industry is often forgotten. The cfo, Chief Financial Officer provides actionable metrics for informed decision making.

Right.

So when I talk about tracking and trackers and I lose 95% of the real estate industry when I talk about it, it's because you can't scale, predictably scale and profitably scale a business without that role filled. And right now even my team, we're approaching 4 million in GCI. We don't have, well, we have a marketing lead, high level marketing lead and a high level coo, our cfo. You know, we don't have a high level cfo that sort of falls on the owners and then we do have a CEO, but it'll be a while. If you're just starting your journey or if you're in the middle part of your journey, well, you'll have to occupy all of these roles and each of these roles holds a different high level area of responsibility that's critical to the health of the business. And, and as a leader, you need to call upon different roles at different stages of growth. So last thing I want to cover here are the keys to building a sustainable business before we close out here. So these are worth writing down. Number one key is life. You must orient work to serve your life rather than something you have to do in order to have a life. Your purpose in life must fuel your work. That's a tough one for real estate. So for a period of time, you will be working hot and heavy in the business, working with buyers and sellers. If you want to build a business worth owning, you've got to do that with an eye toward stepping out of the thing you're building. That's number one is life. Number two is leadership. Our businesses are an expression of us. They will never be better than we are. Here's the tough love. To improve our businesses, we must improve ourselves. That's number two, leadership. Number three, ownership. It's another tough loved one. We must take full responsibility for the business that we've created so we can create the future we are wishing for. The thing I love most about business is that it just, it doesn't lie, right? If I really know your financial situation and I can look at your calendar and I can have a stress or anxiety meter or brain activity meter on you, and I can know what your time, money and stress accounts look like consistently, that's the ultimate measure of if you really have a business worth owning.

Right?

So that's number three, ownership. Number four is excellence. As leaders, we must be committed to ask, how can we do it better? And challenge our people to do the same. All right, so hopefully this was helpful for you. You know, we went through, first of all, what makes you different? If the four factors that make entrepreneurs different than other traditional agents in the real estate industry, if that rung a bell with you, then you definitely know that you're in the right place and you want to continue to listen to this podcast. We talked about that question about replicating your business 10,000 times and how you have to think about it differently. And the franchise prototype question, the four roles of leadership and then ultimately the four keys to building a sustainable business. That's all I've got for you today. Make sure you tune in consistently here. I'm going to do everything I can to add as much value as possible to help you no matter where you are in your journey to get to that next level. I really believe in my heart, in the next three to five years, if you're not building a high performance real estate team, you will be working for one. And if you need any help whatsoever in your business, you know there are ways to get on the phone with me or one of my business coaches for a free business growth strategy session. There's no cost or obligation at all for that. And this podcast is not a pitch for real estate B school. I just know some of you are looking to take a next step and we're here to help if the time ever is right for you. So much love, much respect for doing this work. This is not the easy path and I cannot give you enough credit for fighting the good fight. We'll talk to you soon.