Episode 12: Mergers, AI, and Growth Strategies

In this episode, Jeff Sutherlin and Courtney Twiss discuss the recent merger of Real Broker with RE/MAX, exploring industry impacts, business models, and strategic decisions. They also delve into AI's role in real estate, agent branding, and leadership development, offering valuable insights for brokers and agents navigating a rapidly changing market.

Key Topics

• Industry impact of the Real and RE/MAX merger
• Differences between franchise and cloud-based models
• AI's influence on real estate marketing and lead generation
• Leadership development and succession planning in brokerages
• Strategies for agent branding and market positioning

Transcript

SPEAKER_00 0:06

Well, hey everybody, Jeff Sutherland and Courtney Twist here on our broker rehab, our podcast. We love doing this. Hey Courtney, how's it going?

SPEAKER_01 0:15

Hi, Jeff. I feel like it's been a while, a little longer than normal.

SPEAKER_00 0:19

For sure, for sure. Boy, friends, we got some big stuff coming. I mean, has this industry been crazy the last few years? I mean, every time you turn around, something big is going on. A lot of consolidations and mergers. So we just find out that Real Broker merged with Remax, acquired REMAX to the ticket of an$880 million purchase. And we're talking about Remax here. We're talking about a company that has more global reach than any other company, to my knowledge. By the way, you can all fact check us on this if you want. If we say something wrong, please let us know in the chat. Just me and Courtney talking about what we think is happening out there. But this is a major deal, isn't it? Courtney, pretty big merger.

SPEAKER_01 1:02

It was a surprise. I mean, I I foresaw changes happening to Remax. I think we all did if we were following it, uh, its trajectory, but I did not anticipate that merge with real just because the the design of those two brokerages are so different from one another with their their makeup and their branding. It was just very um, very interesting. And now we get to see a whole lot of it on all of our Instagram feed.

SPEAKER_00 1:28

Oh, yeah. I mean, you look at REMAX, they're really proud of their brand, as they should be. They built a great company, but that's a franchise company, right? So you have franchisees that own these independent, independently owned uh real estate uh franchises. Uh also they've scaled well, they have a good brand name out in the marketplace. They're very proud of that, right? So incomes real, completely, like you said, a completely different model, which is very similar to EXP's, by the way. You have uh equity, you have revenue sharing, you have a cloud-based brokerage. So we have now more, more people, more companies coming to this cloud-based model. So I think Remax agents, you know, when I look at this, they're either gonna embrace it or some people may not. And and so those that may not may be maybe veteran agents, and they sit, they may say, well, this is not what I signed up for, right? So I think that you're gonna see some Remax agents probably wait and see. I think the integration and how they merge these two companies is gonna be very pivotal on whether this is a successful merger or not. What are your thoughts, Courtney?

SPEAKER_01 2:37

I don't quite understand, and maybe you can explain it to me how that this will work with keeping the franchise model and having half the company be cloud-based. Like, I to me, they're so far apart from one another. And if I were like an owner-operator of a RE-MAX, I would be wondering how that's all gonna shake out in the end. Because the beauty of cloud-based models, as we see at EXP, is the low overhead and not having all the brick and mortars, and that's how we can, you know, do certain things that we're able to do because our margins are a little bit structured a little differently. So I just it's intriguing to me. I don't, I don't understand actually how how that will work.

SPEAKER_00 3:23

Yeah, yeah. They see some advantages with uh operational scale. So you'll see real start to to move in that direction. Now we'll see if Remax embraces that uh, you know, at the local level, and then uh to instill revenue sharing into these companies that have never had it, all these independently owned franchises, that's going to be very, very interesting. Um, and you know, basically people had a choice um with Remax. If you're a Remax shareholder, you could get paid cash for your shares, which would be taxable, or you could be given real shares, and uh those have different amounts on them. So that that's pretty much the the um those are the two choices that people have. Um I would expect you'll see a lot of a uh Remax agents interviewing and just to see what's out there because they have to make a decision, you know, do they want to go with this business model or not? Um, quite honestly, my take on it, Hortney, is good for real. Um, I think it's I I say good for you guys to do this. Um, I think, but it the power is in the execution afterwards. Um, and uh I think it's just another feather in the hat of people that operate cloud brokerages because I don't think it's something that it's like a pie in the sky thing anymore. It's mainstream. Yeah. Now exp, the company we work for, closed more deals than any other company in the world last year. Um, so it's not like this is you know futuristic. So tough decisions internally with Remax agents. Um last thing I'll say is I think if you're somebody in a company, uh, even like with EXP, and you start calling Remax agents all the day, all day, I just don't think that's the right move. I I I I like to give people respect and so they can make their own due diligence if people want to talk to me about my model, absolutely. But I think the similarities are pretty there, there's a lot of similarities between exp and real. Um except EXP is a lot further down the road. So and we can complement.

SPEAKER_01 5:35

Basically, which is honestly, which is a big was part of my decision making when I uh brought the brokerage over. I didn't want it, I wanted to go with one that has already figured out some of the kinks, worked out the fee structure, and and and not you know, potentially have to have a lot of major changes happening due to quick growth, like I've seen in some of the competitors. So uh it's nice to use someone that's been through the recession, kind of seen the different markets already.

SPEAKER_00 6:04

Oh, without a doubt. And and is from an agent standpoint, the one thing I like to tell agents out there is you can get distracted by a lot of this stuff, or you could go get another listing, like like Courtney's doing as we speak. She's stacking listings because she understands all the good agents out there are not getting distracted, they're on point right now getting listings, handling buyers and sellers, because honestly, I believe you can be successful anywhere, you know. Yes, I I believe in the personal brand, I believe in your brand, Courtney, I believe in my brand. That's something that our platform at EXP really believes in as well, um, is the agent brand. So I think you can get really kind of tied up around the axle about all these things that are going on and forget about what you should be doing on a daily basis.

SPEAKER_01 6:48

It's noise, it's it's important, don't get me wrong. I do follow what's going on, and there is, I agree, there's been a more than our average shakeup in our industry the last couple of years. And while it's important to pay attention to that, what I'm telling my agents is it's noise. It's just noise. Put your head down, do what you're gonna do. Your clients don't care about any of this.

SPEAKER_00 7:09

That's so true.

SPEAKER_01 7:10

They don't they don't pay attention, they don't know half of them hardly even know about the buyer broker agreement. And it's been years since that's rolled out. So they only sell their home however many, I don't know what how many years we're on average now, close to 10, I think.

SPEAKER_00 7:24

Yeah, yeah.

SPEAKER_01 7:26

So every 10 years or so they're going through a transaction. So they're not paying attention to all the hubbub that's going on right now, like we agents are. So I just do your thing, keep serving your clients and do it well. Be your best that you can be.

SPEAKER_00 7:39

Yep. I think um back to the whole REMAX thing. I was thinking about their company and I've always respected it. I would say, I would guess that if you looked at like the age of the Remax agents in general, it's probably an older demographic. They're a little bit more experienced, and that's why they've always touted a really high production per agent, um, which is which is great. But I think that there's a new generation of of real estate. The industry is now very new. Look at AI. You either embrace it or you don't. And if you don't, I think you're gonna get left behind. I really do, you know, and um, so these these people are gonna have to make decisions, you know. I'm 56 years old, I made a decision. I'm like, hey, I want to learn this AI stuff. You've taught me a lot yourself. So once you learn it, it's fun and I can incorporate that into my business. But I just think with a lot of these Remax uh people, they're gonna have to make difficult decisions, you know, based on their environment. It's gonna come down to environment. You know, what environment do you really want around you at the end of the day, you know, when you make these decisions of where you go?

SPEAKER_01 8:45

Well, I'm curious how it will impact the real agents as well. Maybe it won't at all, but I do know, like from friends that I have at Real or ones that we've talked to, you know, when they need help or support, it's a 1-800 number. Whereas Noah here at the with EXP, we have the world, which people can make fun of it because you go online and it looks like avatars, but it's real people that work with EXP, and you can get an answer to your question usually within minutes. So I was curious, are they are they still gonna have that? Like the 1-800 with they're gonna have the largest aging count now.

SPEAKER_00 9:20

Yeah, by far.

SPEAKER_01 9:21

That feels that would be daunting to handle the logistics on the back end of that.

SPEAKER_00 9:27

Yeah, I don't know the agent count of KW because it's not readily available. I I can't seem to find it when I look online. Maybe it's because it's the ownership is half private or whatever, but I do think they will re-max the real have the highest, or it'll be close with KW. So yeah, there's gonna be a lot of stuff going on. So it's uh it's very interesting. And and you know, I think that when I look at our company, our brand, EXP, I'm a big believer in it. Um, and you know, we have no debt, which I'm very proud of. So it's I think it's a well-disciplined run company. Uh, the lat the latest big news about the uh all the coming soon listings, I love the way our CEO has played it. I believe that he believes in equal exposure, as much exposure for every listing possible. Uh, I think that's the best thing for the actual seller. Um, I I'm very comfortable with you know, with the vision of the company and how we're adding our so much into our value stack. When you look at all the different divisions we have and all the different lead funnels we have, um, it's strong, but but we paid the price. When I was back in the company in 2018, when I started to onboard somebody, it was brutal. It was hard, you know, it was hard to do because we were growing so much and so fast. Now it is so streamlined. I have so much confidence when I onboard somebody, they're gonna be taken well, you know, well taken care of, you know, by the corporation and by all the different uh classes we offer. So just feel like it's very streamlined now. And I those are the things that I'm really appreciative, you know, going being down that road a little bit further.

SPEAKER_01 11:00

Yeah, we've worked out some kinks so that that you experienced that I did not have to experience.

unknown 11:05

Yeah.

SPEAKER_00 11:07

Exactly. Exactly. So um, yeah, you know, just a few more things about the deal. So, you know, uh, real is a cloud brokerage, it offers equity, it offers revenue sharing. There's a there's a few differences in in the revenue share payout model. Um, you could make an argument that um the the upside of the revenue share the revenue share model is better as you go deeper into the ref share model at EXP. Uh, you can also say it's better if you stay on the first and second level with with um real. But what I would encourage people to do, honestly, if you're like, what do I do next? Talk to somebody at real. Talk to somebody like us. You know, I think it comes down to the people. The pe because if you're looking at similarities between models like these, what is your environment gonna do for you? You're right, right? I mean, do you get to hang around people like Courtney? Right? That is everything. You know, so you you can have the best model in the world, but if you don't have the right people around you, it doesn't matter. It doesn't matter. And would you agree with that?

SPEAKER_01 12:14

I do. And and everyone, you're not we're not all a fit for everyone, and vice versa, right? When you're when you're making moves, it's uh should be an interview going both ways because it's equally important. It's a new partnership, maybe not an official partnership, but it's your green to to who you want to work with and what world you want to be in, what rooms you want to be in. And I think it is to your point, it's very important the the people that you lock arms with. Um, but you it's gotta be a fit from from both sides.

SPEAKER_00 12:45

Yeah, absolutely. Well, you know, if these things keep happening, wow, my head's on a swivel lately. It's like I gotta stay focused on getting business. And um, you know, Courtney and I are really excited because um she's been doing some really high-level stuff with AI, with training, and um and uh Courtney, could you share a little bit about like what you're doing in that space? Uh, I know by the time this comes out, it probably won't be in time for the training you have tomorrow. But can you talk a little bit about some of the stuff you're doing in that space? And we're getting a lot of good traction on it.

SPEAKER_01 13:17

Yeah. Well, to start with, I am coaching our clients and and fellow realtors on how to be visible to AI. Whether you you like AI, whether you are kind of fearful of AI, whether you hate AI, you have to learn how to make money off of AI. And I think we all want to make money, right? We all want to make money. We're we have to, we have to make a living. So that's a course that I'm I'm doing right now is how what is AI looking at? How do you get in front of it? How do you become the one that shows up when someone searches for the top realtor in their market? And that's a course that I'm doing them starting tomorrow. I actually I've actually talked on it a few times now. But we will be doing every 60 days or so, I'll be having some different courses on AI. So people can just kind of pay attention and follow because I'll have some other ones that are related. That would be very helpful.

SPEAKER_00 14:17

So, Courtney, are you seeing people? Let's say you go on a listing appointment, right? And um, and are people, when you leave that place, going into Chat GPT or Claud, and are they saying, tell me everything about Courtney Twist? Is that what they're doing?

SPEAKER_01 14:30

No, you know what they're doing? They're doing it before they call me, and that's why I'm getting the call.

SPEAKER_00 14:36

Okay, so they're not even going to Google.

SPEAKER_01 14:38

They're no, they're I'm number one through Gemini and chat for my market because of strategic moves that I have made. So I have had, for example, two success stories within the last 30 days. Uh, one's a buyer that found me because he asked who's the number one realtor in my market. And I came up number one. And he said, That's why I called you because I asked, and it said you're the one. And then I got a seller that started saying, Well, I use chat to research who to hire. And I noticed this, this, this. You have a higher price point, you have a luxury div, you're in the luxury division. Um, you sold more deals than anyone else. And she's spouting off all this structured content that I fed chat, literally verbatim. I could recognize the wording. And both that buyer and seller almost double the price point of my market.

SPEAKER_00 15:31

Oh my gosh. Okay.

SPEAKER_01 15:32

That's just the last, that's just the last 30 days. And I've another agent that's been working with me in another market that's had some major success from that, too.

SPEAKER_00 15:39

Okay, so we're not talking theory, you're actually getting it done.

SPEAKER_01 15:43

Yes, and that's what I'm teaching out to do.

SPEAKER_00 15:47

All right, so I'm putting this thing out to everybody, Courtney, and they better contact you because this is it, man. This I mean, that's huge. That is that's a big deal. It is, so that's yeah, and it's only gonna get bigger, right?

SPEAKER_01 15:58

I mean, as more people adopt these LLMs, it will, and I will change things and you have to monitor it, right? Because as more people do what I'm doing, that will change and improve the sourcing of AI. But like right now, I feel like it's a um, like I'm a pioneer and I'm moving west, and I can just there's all this for my taking because no one's doing it right now. So I am just trying to capture all the benefits that I can while it's fairly easy because it will change.

SPEAKER_00 16:30

I love I love pioneers. I love pioneers. Um, what else are anything else you're working on right now, Courtney? Because you got a lot of good stuff going on. Anything else you want to talk about?

SPEAKER_01 16:39

Uh related to AI specifically.

SPEAKER_00 16:43

AI, yeah, or just anything in your business you're seeing shifting?

SPEAKER_01 16:46

Well, I have always been listing focused. Um, I have a team and my team works our buyers. So very, very rarely, if maybe never, do I go out on any buyer, buyer or any showings. So that's an area that I have offsourced um due to my preferences and how I value my time. I feel like my ROI is higher on working on the listing side. So that's been my focus. Even when the market has been shifting to a buyer's market, I am still focused on listings. And buyers come from that and I feed them to my team. And the listings will sell if they listen to you and you price them the right way. Even if some of them take a little bit longer, they will sell. So that's an area that I've decided strategically to stay focused on is just keep moving forward with the listings. It does pay off. And then, and that's how you build your brand because you want to have your signs everywhere. And my signs are everywhere.

SPEAKER_00 17:45

Ah, wow, I love it. So, this kind of reminds me of the whole idea of this show, right? We call it broker rehab to help brokers understand how to be successful, eliminate some of the stress in their lives. You know what lanes to focus in in your business. You know exactly what you're focused on, and you know what you're not going to focus on. And you focus on listings, and um, you hand the buyers off, right? So, as a brokerage owner, you have brokerage owners that are trying to do everything out there. Then they have news like this. They're always under pressure because I've been there, so have you. The pressure is you have to compete against a tech stack of companies like EXP Realty and Real and such. That's pressure. So, what we would recommend, or at least me, I would say you need to excel at the things you're good at. Number one, you have to be a good attractor of talent. If you stop growing, you will slowly die. That is the truth in real estate brokerage world. So you need to get good at recruiting quality agents. And then you need to get really good at supporting them. Okay. And then as you go, you build your profitability, then you can add some of these tech solutions. But um, it's really key that you don't try to be everything to everybody, or else you will burn out. You will burn out. You know what I'm saying, Courtney?

SPEAKER_01 19:04

I do know what you're saying because I did it. And I was in that, I can't remember the turn they call it. Maybe you remember when you're in that phase. I think it's between 30 to 50 agents in your brokerage. Yep. I want to call it like the death phase, but that's not the right words. Essentially, it's like the really hard phase because you're growing and you're managing all these people, and and you're feeling that pressure to do exactly what you're talking about, to offer all these different things to them and you're paying for it, but then there's not quite enough agents there to build the profitability that needs to go for what you're needing to offer to them. So I was in that phase for quite a while and it was I had experienced some pretty strong burnout.

SPEAKER_00 19:43

Yeah, I hear you. I hear you. Well, we touched on a few things today. We talked about the whole real thing, and uh, you know, Courtney and I would just invite you into a conversation if you'd like to have ever had one with us. We can certainly certainly share what we do. Um, there's I think there's benefits to all those different models. Um, but I think it's really a matter of who you want to be in business with, who do you want to run with. Uh, and we're always here to help you and support you. Um, definitely look up Courtney on all the stuff that she's doing with AI right now. Um, uh Courtney and I are part of a uh coaching company, which we're really kind of excited about. So that's just another added passion that we have helping agents succeed. And I've personally watched Courtney like totally excel and thrive and become a really good coach in a very quick, quick amount of time. So we have a lot that we'd love to help you with if you want to reach out and ask.

SPEAKER_01 20:36

Yeah, well, you keep saying all these nice things about me, but I have to say I learned so much from you of that, like how to be a coach, for example, with growth yard coaching. You've been coaching for over 20 years, and you have many, many client success stories that you know you could you can show. The proof is in the pudding, right? You've helped so many agents, and I have reaped that same benefit of learning how to follow in your footsteps. So it's been a pleasure uh working with you, and I can't wait to continue doing it the rest of this year. It's gonna be fun.

SPEAKER_00 21:08

It's gonna be fun. We're just getting started. I I have to share a quick success story. I'm so excited about this. So I've been coaching a lender that owns a company uh in the Midwest, and he's been doing this for a good 15, 20 years, very successful, independent uh mortgage broker. And um, he's my age. So he's starting to think about his exit strategy a little bit and how he would like to retire um, you know, in the next five, six years. So we had a lot of real deep conversations about, you know, who is the heir apparent, who do you who does he think would be the next person that would take it? And uh we actually did a lot of role playing, right? A lot of role playing with each other. I was the other person, he was himself, obviously. And then we basically walked through that and we designed a like transition strategy, you You know, with his wife involved too, because his wife has some ideas. So we're slowly walking through this, and he had the conversation with his employee last week, and it went wonderfully. And you know, there was a lot of pressure on him to have this conversation. It was kind of like one of those things he needed, he knew he needed to do, but he just hadn't done it yet. And he had it, and that was the beginning of a great, what we believe is going to be a great transition because this guy totally embraced the thought of him being more active in the business. Um, the uh the owner now gives him access to see the PL, which he's never seen. So this key employee now feels even more vested that he wants to help the firm succeed, knowing that you know, a few years down the road, he could be in a pretty big position in this company. So it's it always is about leadership, right? And and developing people. And um, I used to coach people at Intel Corporation when I was, you know, back in the corporate world years and years ago, and they taught me to do a 90-day development plan with employees, especially my frontline people that I supervise. Every 90 days, I'd sit down with every one of those people and I'd talk about their life, what do they want to achieve? A lot of their areas of improvement or projects were were tied to the things they want in their life. Right. It's not always about, it's not always about doing the work at work. You know, people are human beings. So it's I'd always work hard on that part. And uh by doing that, I gained a lot of trust with my employees, and they were always working on something new, always working on something to grow. Uh, instead of just always, you know, hitting them over the head with what has to be done this week. It was about their development. So he started doing this in his firm, and people are loving it. They're loving it that he sat down with people and said, you know, I just want to tell you how much I appreciate you for this, this, this, and this, all the things you're doing, and what would you like to accomplish next in your career? So um, I know that was long-winded, Courtney, but that's very cool, you know.

SPEAKER_01 23:58

Very cool. Well, when you're talking about the transition, and that's a big topic for brokers, team leads, high-producing agents. Like, how do you what does that look like? What is your exit exit strategy? That might be a good topic for one of our episodes.

SPEAKER_00 24:13

We guys should there's different whole document around that the golden handoff. We should talk about that next.

SPEAKER_01 24:19

Ah, exactly.

SPEAKER_00 24:21

Yeah, okay. So uh you can get a hold of Courtney. What's the best way now, Courtney? Because you're you're everywhere now.

SPEAKER_01 24:27

I would say Instagram, all things twists, DN me. That's my platform.

SPEAKER_00 24:33

Awesome. All things twists, and then the Jeff Sutherland show on YouTube. I'm also on Instagram, a little bit smaller than Courtney's uh reach, but I'm on Instagram as well. So hey, everybody, have an awesome day. And we'll we'll thank we we give you thanks for showing up today. I hope you got some value out of it. Talk to you soon.

SPEAKER_01 24:51

Well, hang on, Jeff. You need to do a bro the uh recharge room. You need it in a recharge the battery, and you gotta give them one takeaway to get them feel and me too. Maybe I need it, uh, feeling recharged and ready to go for the rest of this week.

SPEAKER_00 25:07

Okay, so here it is. Take your phone and instead of looking at it before you go to bed, are you guilty of that, Courtney? Do you ever do that?

SPEAKER_01 25:15

Yes, I do do that.

SPEAKER_00 25:17

Take your phone, put it in another room, okay, not in the same room you're sleeping, and actually put it there. And actually, there's been scientific like studies that it's actually better for you because a charging phone next to your head is not a good thing for your health. Take it out of the room. I tell you what, right now, Courtney, I've slept so much better after I started doing that two months ago. Separate it. There you go.

SPEAKER_01 25:39

Thank you for that. I needed to hear that.

SPEAKER_00 25:43

All right, everybody. Thank you.