Yeah. Those. Couple things here. Currently, I have a split superior to any that I’m aware of in the industry (other than 100%-Because-I-Own-The-Firm Split, but one could assert that you would then have more expenses than I do). While that may seem like the golden goal for every new agent, I’m not convinced that’s true.

My split now is 90/10 with a $6,000 cap. There’s a transaction fee of 0.085% of the selling price of every side. That’s it. I have some (former) colleagues who complained that when you’re doing $20m+ of deals in a calendar year, that transaction fee matters a lot. Anything sub-$15m in volume though and it’s not really a huge deal for most people.

So, what do I get for that little bit of money? Not much. I have a broker of record. I have a Broker-in-Charge that I can call for help with big stuff that I don’t know how to field myself. There are some physical office spaces throughout the states that we’re active in. There’s a main HQ with an accounting/compliance team (helpful), and some marketing folks that don’t really affect me one way or the other. There’s a subscription to kVCore that I don’t really use. And E&O. That’s pretty much it.

I like this setup because I’ve been selling real estate for a while, know what I’m doing, and feel comfortable working autonomously. Beginning in a situation like this though, I think, is a horrible idea.

Here’s why:

There’s very little, if any, effort made to train new agents. There are some checkbox processes they have, but mostly you’re on your own. No office meetings, no mentorship, no real education. For me, in the beginning, that mattered a hell of a lot. They had no processes where I started (to speak of) other than latching onto someone.

I shadowed (I followed him everywhere I could) one of the top-producing, slick-talking, stud brokers in our area for my first 6-12 months. I rode with him, went on appointments with him, and worked for him (for free, even though he made me think I would earn money somehow). It was all a part of my education (way more valuable than money, in hindsight). I’d linger around his office. I’d stay late and he would often be there late too. It was good. It mattered.

I eventually left primarily because of the money. That, and because I felt like I couldn’t trust this guy that I was just describing. That’s a more complicated situation to explain, but it would be dishonest to ignore that it played a role in my leaving the firm.

At the time, that firm was taking 50% of everything I made. I had no idea how lousy that was until I found out I could make 75% with a $15,000 cap down the street (where I still hang my license). I couldn’t imagine how much money that was — what a difference!

Well, less than a year after I got to the company they cranked up the compensation plan to what I previously described, and I was even more happy about my decision.

But I’d be lying if I said I didn’t miss some of that comradery and contact we had in that office. My business partner began in that same firm working with that same man. We both miss it. But, we’ve come together and formed our own company (team), in part, so we can have that again by working together.

Not only is this a lonely business, but in the beginning, it’s so important to have people to model ourselves after. I still think it’s important for me to have that, and it’s an area that’s lacking for me and has been for a while. We’ve considered changing firms for that reason and may still — even at the cost of $5k-$10k per year in splits.

Little has done more to enhance my career (and my life) than learning, and one of the most immediate, effective, and thorough ways to learn is from people that you work with.

So, before you sign up for a cloud firm with people ALL OVER THE WORLD to support you, consider that it might be more advantageous for you (not to mention that it may increase the odds of you surviving in the industry) to join a team or firm that’s local to you (and has “culture” or at least people that give a shit about your success). It matters to have that level of support. I’ve seen countless people join my firm and office in the last several years who are no longer real estate professionals.

It’s a people business, but we’re people too. I’m an introverted computer nerd that happens to be moderately attractive and can talk 1-on-1 well enough to sell some shit. I hate rooms, I hate parties, I’m not that slick. I’d much rather be reading a book than be at your BBQ, and when I get home from your BBQ I want to lock myself in my house for two days to decompress. And I’m here to say that for me it was absolutely critical to be around people (and successful people at that) early on, and perhaps still.