Speaker 1 (00:00:00):
For insights into starting, growing and optimizing your real estate team. We're talking with Matt Smith.
Speaker 2 (00:00:05):
I believe that true leaders create other leaders, not just more followers.
Speaker 1 (00:00:10):
He's the president, CEO and functionally, COO of Matt Smith Real Estate Group, the number one team in mid-Missouri in the number two team in the state. He's a local born and raised in the community in which he built his business and he hosts the podcast all or nothing in real estate and coaches, other teams and leaders. Thanks so much for talking to Team Os today, Matt.
Speaker 2 (00:00:29):
Yeah, thanks so much for having me. It's an honor to be here.
Speaker 1 (00:00:31):
Yeah, it's overdue. I've intended to get you on the show, but here we are. So we'll get going with it with a question I've asked everyone at this point in the conversation, which is, what's a must have characteristic of a high performing team?
Speaker 2 (00:00:44):
That's a great question. I think I'd be lying if I just gave you one. I don't think that there's commonalities that I've seen, so I'll answer this with, I'll go a little more elaborate here than probably what you're used to. I'll answer it from my own perspective as a team leader, but also from a coach that's been behind the curtain of a lot of high performing teams and been in the rooms with a lot of the highest performing teams in North America. I think one of the things that are very common is the teams that continually grow and improve, they put an emphasis and focus on culture and they make sure that they have an environment of productivity and environment of positivity and an environment of accountability. And I think that culture in today's society is an overused word. I think people don't truly understand what it really means below surface level, but the teams that grow continuously really have a depth of understanding on the word culture and make it a priority in their organization.
Speaker 2 (00:01:50):
In addition to that, I think having great leadership, I think leadership is a completely different language. And what I mean by that is that if you went to go to a foreign country and you wanted to live there, you'd have to learn how to speak their language. So many agents go from agent to team leader or from agent to sales manager or whatever the progression is in most people's journey that will be listening to this podcast and they think it's the same principles, the same skillsets that apply and unfortunately that's just not the truth. And so you have to learn and adapt to a whole new language of leadership in order to continue to grow and scale. And what I love about that is it's a challenge. Learning sales skills is its own challenge, but learning leadership skills is challenging all in itself. And I think that's where I see a lot of leaders get stuck. And so I think that you have to have a great solid leadership structure and leadership language in order to continue to grow and scale your real estate team.
Speaker 1 (00:02:53):
Awesome. You gave me so many things I wanted to get to anyway right there. So I guess I'll pick up right there on, and I appreciate you acknowledging the types of folks that watch and listen to a show like this one. And I'd love for you to speak to them on this leadership. Is it for anyone as long as they commit themselves to it or in your experience and observation, are some people more attuned to it because I guarantee someone is watching or listening and thinking, oh yeah, leadership, it just wasn't for me. Are people being honest with themselves or people selling themselves short there?
Speaker 2 (00:03:28):
Yeah, so I think it is a great question, and again, I can't answer it for everyone because I've seen it both sides of the coin and I think it's just a really honest conversation that people have to have with themselves. And so one of the things that I've observed is the blanket answer is leadership isn't for everyone. And so not everyone is meant to be a leader. And what do I mean by that is that leadership is its own, it's its own little beast and it's separate from real estate sales. And so you don't have to be great at sales to be great leader. It certainly helps. Some of the characteristics are parallel. And in addition to that, someone that's saying, well maybe leadership isn't for me, I also would argue with them and just challenge them on their thinking a little bit, is that leadership can also be a learned trait.
Speaker 2 (00:04:14):
People aren't born great leaders. There are skills and traits that are learned and acquired to become a great leader, just like become a great salesperson or become a great entrepreneur. Or another word that I love a great entrepreneur. And so what I say entrepreneur, that means inside of a company. And so I think that to answer your question of I tried leadership, so someone that's on the path and they tried to become a leader and they're like, man, maybe this isn't for me. What if you became an informal leader inside of an organization? Meaning that maybe you don't have to be a team leader, but you can be an agent if that's what you love doing. And you can have the leverage of a team and you can be that entrepreneur spirit or spirit where you contribute to the team and you still do sales and you do sales at a very high level, but you can contribute to the team because you're an informal leader that helps grow the organization, helps give back to other agents on the team, helps grow maybe ancillary services or whatever path that your team leader is on.
Speaker 2 (00:05:14):
Because I'll just tell you from my personal journey, having great people that being able to develop other leaders and people that I'm building something big enough that their vision can fit inside of our vision has been a game changer for our company as we've continued to grow. And so I think that leadership looks differently for different people. It isn't for everyone, but it also can be for a lot of people if they choose to spend the time the energy and be around the right people to learn the entirely new language of leadership. It's literally with my coaching clients because I coach team leaders growing teams and that's one of the biggest things that we talk about is how to develop that leadership language, how to speak that themselves, but also how to invest that into their other people because I believe that true leaders create other leaders, not just more followers.
Speaker 2 (00:06:08):
And so true leaders can not only learn those skills themselves but also pass along to other people so that you can continue to grow and develop other humans at some point in time in your real estate growth journey. If you want to grow a team, you have to realize you're no longer in the transaction business, you're in the human resources, human development, human attraction business. And the better you can be at speaking and communicating to humans and helping them grow and accomplish their dreams, their goals, their desires, the quicker your team will grow as well. One of the things you said is that it really strikes a chord with me because I had this wrong for so many years and so I hope the listeners can learn from my mistakes. So I think that a lot of leaders will say that, well, the agents are my customers. That's what I used to say. If I'm the leader, I'm a servant leader and so I'm here to serve the agents, which is absolutely still true, but the agents aren't the customers, the agents aren't the clients, the agents are my business partners. Whenever I made that language change and I started treating them as business partners versus clients or versus customers, the whole game change for our organization. And here's why. Ethan, if I were to ask you to finish this sentence, the customer is always
Speaker 1 (00:07:23):
Right.
Speaker 2 (00:07:24):
The customer is always right. Are your agents always right? No. Do you want them to think they're always right? No. So why are we telling them they're our customer, they're our business partner and we want them to be in alignment with the vision and the direction of the company where we are going together collectively as business partners. And when you can really treat your agents, your company, your team members as business partners, it'll help you go to levels that you only ever dreamed of.
Speaker 1 (00:07:49):
Man, so much good advice in there, and I especially appreciate that you ended up bringing it back around to culture even though you launched off leadership and leadership and culture is where we started. I would normally bring this up later in the conversation, but it's also right here too. I don't know if you've been through it yourself or how you thought about leaving sales production, whether how, but I'm certain just the types of folks you said that you're engaging with regularly, a lot of them are probably on this edge or they're going to be looking forward to it and different people make different choices at different times for different reasons. But in general, when you break this down for folks, what are a couple of the key questions or observations or tips that you offer them so they can make the right decision for themselves at that time?
Speaker 2 (00:08:33):
Yeah, such a great question. So what you said reminds me of a quote that I say all the time is that I've just observed that I being fortunate to grow, what I've been able to build, what I've been able to build and be around a lot of amazing people that have contributed to my success is everybody does it differently and it works differently for everybody. There is not this one size fits all model for real estate. There just isn't. I think that there is some value in trying to model some other success. Success leaves clues so we can model after other people that have been there and done that certainly. But I think we have to realize we also have to be nimble and be able to pivot and adjust for what works for us. And so one of the first questions I ask, a team leader that hires me as a coach or just wants to have a conversation, they say, Hey, I'm ready to get out of production.
Speaker 2 (00:09:26):
How do I do it? I just ask them a very simple question, why is getting out of production important to you? Why? Yeah, why do you want that for yourself? What are you trying to accomplish by getting out of production? And I think if they just really go in depth with themselves, getting out of production isn't for everyone, right? There's some pain that is involved with getting out of production. There's a lot of pain involved in that growth trajectory. I call that the messy middle for a lot of team leaders. And that's where a lot of team leaders get stuck because it's a very tough growth path. And so it's not for everyone. And I've actually coached some team leaders, especially with this recent market changes that we've had to get back into production because we have to quit worrying about what other people think and we have to do what we want for the reasons that we want for our families, for our goals, for our desires.
Speaker 2 (00:10:18):
I think too many people worry about what the outside world thinks and what their perception is versus what we actually want and why we want it. And if someone loves being in sales, someone loves working with buyers and sellers, someone loves having that connection with their clients, why are you going to give it up? Why you better have a very, very good reason on why you want to grow, why you want to actually get out of production to lead agents, why you want to focus on other things other than helping buyers and sellers? Because there's a lot of high performing leaders in teams that do both, and there's nothing wrong with that. And so let me just normalize by saying my opinion is you don't have to get out of production to be a successful team leader despite what most a bunch of people will tell you.
Speaker 2 (00:11:01):
I don't think that's a fact. I think that it depends on what your goals are, what your dreams are, what your desires are, and you can pick the path that makes the most sense for you. And so the very first question you should ask yourself in my opinion, is why do you want to grow to that level? Is that really what you want? Is that really truly what you desire? And if so, awesome, there's a proven framework to get you there, but the next question is even tougher. What are you willing to sacrifice in order to get it? Because that comes with a lot of sacrifice. And if you're not willing to make the sacrifice, then maybe we need to go back to question number one because your why is not deeply rooted enough within yourself for you to sacrifice to get that. I don't know if that answers your question. No,
Speaker 1 (00:11:44):
No, it does. It's fantastic. And it is because it's an impossible question. I mean, no, as you said right off the top, there's no one answer. By the way, a quick promotional note for folks, folks watching and listening, I actually made two complete episodes hearing from 12 different leaders in total on this topic. One of them is called How to Leave Sales Production Successfully, featuring seven people who left sales production successfully and some of the hard stuff they went through on the way. And then the other one is five different folks talking about why to stay in sales production. And all you need to go do is go to realestate team os.com/subscribe, and those subscriber only episodes are instantly available. Thanks for sitting through that promotional note, Matt. Appreciate it. I love that. I'd love to get into your journey, at least the high points of it. How'd you get into real estate? What was exciting about it to you? When did the concept of building a larger organization occur to you? What were some of those first steps? And then after we get a little bit of story arc there, we'll get a snapshot of Matt Smith Real Estate Group in Q1, Q2, 2024 here.
Speaker 2 (00:12:44):
For those people listening that have not met me yet, I feel I'm qualified to share how to get out of production because done it and I'm out of production, have been out of production for almost five years now. And so I've gotten out of that and stayed out of that and then moved on to other things to be able to help and give back to other people. But it hasn't always been that way. So lemme go back to the beginning. Born and raised in a very, very small town. There was no stoplights in my town. That's where I grew up. My high school graduating class had 30 kids. My very first job was working at a sawmill stacking slabs for $20 a day. I come from very, very humble beginnings. I don't know what it was that flipped in my head, but some switch flipped and I said, I want more out of life.
Speaker 2 (00:13:34):
I feel like there's this calling that I'm meant for more. And so I just went on this journey to go find more. I didn't know what more was. I started reading books, I started podcast, podcasts weren't a thing back then, so I started finding people to watch and mentor and I was just investing in myself and I was learning from people that thought differently than people did in my small town. And I think that's why one of the things that I continually say today, I just had a podcast, I recorded myself this morning that I said, your environment matters more than you realize. And I think a lot of people go back to my small town analogy. I was stuck in small town thinking because that was my environment. And so I immersed myself in bigger thinkers and then I became a bigger thinker and now I accomplished bigger thanks.
Speaker 2 (00:14:20):
And so as I went on this journey of trying to find better, I stumbled across people like Tony Robbins and just these gurus of success. And I had a moment where I was working in a family business and I just had a moment where, you know what? It's time for me to look for more and I need to go all in on whatever that more is. And so I quit the family business and I just went on a journey to go find better. And I went from this job to that job to this job, and I just kept trying to find what is meant for me. And through that journey, I found some sales jobs and found some success and some sales jobs. And one of the jobs led me to a sales call that was actually, it was funny, my now wife was my fiance at the time, and she worked at a real estate company, a property management company, and one of the sales calls for the radio station I was working for led me to her business and I didn't know it.
Speaker 2 (00:15:20):
And so I showed up there and it was kind of a funny story, but it led me to a conversation with that owner about, well, if you can sell air, I think you can sell real estate. And so, alright, how much can I make? What can I expect? And so we had that conversation and I am an all or nothing kind of guy, hence my podcast name. And so I literally quit my job, went to real estate school and said, let's do it at this time, it's important to note I'm, I'm still a young guy and don't have a family, just have a fiance, no family yet. But through this journey of trying to find myself and job hopping and finding this quote career that I left three months later because it wasn't for me, just that weird transition phase that I was in, money was tight.
Speaker 2 (00:16:10):
So then I'd get into real estate, I get my license and we have a baby on the way. And so I remember we had, I came home from the hospital with my six week old daughter and I remember looking at the counter, I opened the fridge, there was no food in it, looked at the counter. I had three months of electric bills. I'm like, man, when am I going to be able to sell this real estate stuff? Then the very next day we go to the hospital for my wife to get a checkup, and that's when the scariest moment of my life happens. I remember walking in with my daughter to go into the hospital room to see my wife. She just had some normal surgery. It was just a normal surgery. So then we walked in and all of a sudden I open the door and the doctor kicks the door closed and comes out dressed in what I can only describe as a hazmat suit, and he says, Matt, we have a problem that's not good.
Speaker 2 (00:17:06):
I'm holding my six week old baby. And he says, so unfortunately we've had some complications. Your wife has developed severe staph infection and there's only one antibiotic that we can give her to get rid of it and she's allergic to it. And so one of two things are going to happen. We either give her the antibiotic and we poison her and kill her, which we can't do, or the staph infection is going to take over her body. She has 24 hours to live. So get dressed up, take your daughter in so she can say her goodbyes and you could tell her so she can say goodbye to her six week old daughter.
Speaker 2 (00:17:45):
That was reality for me at the time. Brand new into real estate, of course, real estate was on the side. Long story short, my wife pulled through. It wasn't an allergic reaction, she was just stressed from hives from all this stuff. So a long healing journey. My wife is fine, we have two beautiful girls, but we didn't think it was going to be that way. And so a moment like that will change your life forever. And so at that moment, it was just kind of a wake up call for me to get real with what this career journey that I was on. And so I just dove head into real estate my very first full year in real estate. I sold 74 houses by myself, worked daylight to dark, just I was not going back to that broke place to that place of that feeling of I've got a six week old daughter and I can't even provide food.
Speaker 2 (00:18:39):
I just wasn't going back there. I was going to be a single dad in that moment. During that 24 hour period, I refused to go back to that place. And so I just went back to work and I figured out a way to make it happen and one thing leads to another and I continue to grow. I hired an assistant, then I hired buyer's agents and we grow this thing called a real estate team. And as we're growing the real estate team, we run into some roadblocks in our small town again of we're growing too quickly. And so we start butting heads with some of the ownerships and different things and get kicked out of our office. At one point I got kicked out of my office. We had started from absolute scratch from our real estate team to sell a hundred houses in a year. Then we were on pace for 220 the next year, very, very rapid growth.
Speaker 2 (00:19:31):
And then literally I walk in the office and they say, it's time for you to leave. And I'm like, all right, that's unfortunate. I'll get my stuff and go and we'll figure it out. And he says, oh, by the way, those 97 listings that you have, those are mine as the broker in the state of Missouri, I own those. Don't you call them, don't you reach out to them, them are mine. Not to mention the 42 pendings that we had started from absolute scratch again, had to go work in my basement, half my team stayed because they were scared of the repercussions of leaving and this whole thing. So I just worked my tail off to get to this point, and then the rug pulled out from under me all over again. But one thing that I'll tell you for listening to this right now is that the will to win and the persevere and overcome and continuously focus on doing the right thing and serving others, the law of reciprocity always wins.
Speaker 2 (00:20:29):
And this is not to talk down on anyone. This is, I wish everyone the best. I don't wish Ill upon anyone, but I'll just tell you that that building that I was kicked out of now has my for sale sign in the front of it, and that company is no longer there. So everything happens for a reason. And so we do that. We joined this cool company called Realty, and then we just continue our growth path. We sold at our peak, we sold 777 houses in our biggest year in 2021. And here we are today,
Speaker 1 (00:21:02):
Man. Okay, first, thank you so much for all of that and I'm glad you have a healthy, happy family. And I mean, I feel like I obviously don't know anyone or anything about the story and we don't need to dwell in it, but my imagination is that there was some calculation being done that says, well, we can claim all this stuff and all we have to do is throw him out of here. And at a certain point, the numbers were such that made sense financially that we'll essentially chips off the table. We'll just hold these chips off the table and send him off to another game.
Speaker 1 (00:21:41):
Mean what were your options in that moment go to that window for, that's probably more dramatic in experience than most people are going to have. I think we're at a point now where if you're building a successful team inside an organization, it's probably not just with the permission, but probably even with the blessing and the support of the person you're with. And it certainly has not always been that way, and it still isn't that way. There are a lot of cultures, frankly, that maybe will tolerate it, but they certainly don't support it or embrace it. But for you, the only story that's come close to this was Gary Ashton's story back on episode one of having separate but similar issue with the office that he was in. What were your options at that time when you got that news? I'm sure it was just a straight gut punch, so you have to gather yourself and put together a plan and try to bring as many of these team members with you as possible. Take us back to that moment. What were your options on the table and what were your first couple steps?
Speaker 2 (00:22:41):
Yeah, so to be honest, I'd already felt the ceiling I was hitting my head on of just the tension in the office. So I was preparing in the background for a move for transition, but I wasn't ready yet. And so my options at that time were I had my broker's license, so I was just going to open up my own company. I didn't need a broker anymore or I was going to join this little known cloud-based company at the time called exp Realty. This was back in 2018. And so we decided to ultimately partner with exp just because of the, to be honest, one of the main reasons was I didn't feel like I was ready to be the broker, nor I didn't want to have to be, I'm not the paperwork guy and I didn't want to hire someone to be that person. And so there was that.
Speaker 2 (00:23:32):
And then also just not to have a pitch fest here, but just the opportunities that presented to the agents that decided to join me that I couldn't offer without the company. And so that right there was honestly the decision. It was like they can provide so much more opportunity to my agents than I can without 'em. I have to do it. I owe it to the people that are going to partner with me to make that decision. And I think part of that too is I have a saying that I'm actually preparing for a speech at BRI Gov's event and Cabo next week. I was preparing this morning, and the theme of that is one of my favorite quotes is Life doesn't happen to me. Life happens for me. And so I think that me telling my story reminds me of that, and it reminds me of the mindset of whenever I decided to partner with exp, I didn't do it for me.
Speaker 2 (00:24:23):
I did it for the agents that were going to join with me. I did it so I can give back to others. And I think that that reminds me of people stealing money from me and stealing hundreds of thousands of dollars in listings and all these nonsense that happened during my journey was such a blessing in disguise because success sneaks up on people. My journey, literally my first year in real estate, I paid more money in taxes than I ever made in my life. That was how quickly my success trajectory happened. And so whenever that happens, I think that success can change people, money can change people. And so I think that's just a way to keep me grounded, to keep me humble. And it taught me all kinds of lessons of what I don't want to be, who I don't want to become, and I would not have the culture, would not have, the company, would not have the friendships, the business partners that I have to today without those experiences in my life. And so as much as they stung at the time, I'm so glad that they happened because I love where I'm at in life. I love the people that I get to work with. I love the coaching clients that I have, the stages I get to speak on the podcast like this that I get to be on and just to share my message and my journey to hopefully help someone else that wouldn't have happened without those hardships. And so I think all those things happen for me, not to me.
Speaker 1 (00:25:44):
That's great. You always strike me as someone like, I don't know why I was even thinking about this, but you strike me as someone who doesn't bother with regret. And that's basically exactly what I heard here. I would love for you to characterize your team as it stands today, size, culture, structure, whatever you want to share. But I would also love for you to maybe start with the market. I mean, when I hear you say you sold 74 homes on your own in your market, and when I say a top team, the number two team in the entire state, typically if someone had to guess where the top 10 teams in the state of Missouri are, I think most people would go to Kansas City or St. Louis. And I imagine there's something special or unique about your market besides it's probably more geographically spread. Those 74 homes were probably to drive to all of them is probably a longer distance than anyone else who sold 74 homes that year. But maybe start with market and then get into again, size, culture, structure, whatever you would like to share about your team as it is today.
Speaker 2 (00:26:46):
So we've accomplished amazing things and we're in a very, very small marketplace. So our local board has around 250 agents in it. And so we carry 20 to 25% market share on any given year, which is just absurd. I tell people that and they don't believe me, but it's reality. So one in four or five houses a year, we sell in our marketplace, and it's been built up over time. But I think a lot of people use, let's go back to the mindset, the small town thinking, people think that, well, no one can have 20% market share. Why not? We've proven it. And it's just because, again, this goes back to the importance of having mentors and leadership and self-development for myself of just learning from other people, having great coaches and mentors in my life that have helped me see life through a different lens.
Speaker 2 (00:27:44):
I would not be where I'm at without that. We would not have a real trends ranked team Inc. 5,000 fastest growing company three years in a row and our small town where no one knows what Inc 5,000 is. If it wasn't for me immersing myself in rooms that I was uncomfortable being in because I knew I was meant for more and I wanted to help more people. And so I want to go back, I think people would need to understand the importance of that. Wherever you are in life, if there's a room that you think you need to be in but you're scared to be there, just go. Just go. Your gut is telling you you need to stretch yourself and you need to grow. Stop trying to be the big fish in a small pond and go find a bigger pond and go where the big fish are and you're the small fish and they scare you because they will contribute.
Speaker 2 (00:28:32):
That's where you learn and that's where you grow. But so we're 20%, 25% market share depending on at any given time. We currently have three locations, so we've expanded recently we just opened a branch office in the lake of the Ozarks market, and so that's a relatively new office that's about a year old, and we are growing very rapidly up there, just taking our proven model of processes and stuff, implementing 'em up there, going really, really quickly. We're on pace to do 800 to 850 units this year, depending on kind of where things fall. It's very early to tell, but we're on pace and we currently have 28 agents currently, which is down for us. But as the market tightened, we made a decision to tighten our standards and we believe in recruiting. And so we have a pipeline full of agents that will be coming on board.
Speaker 2 (00:29:29):
And this may be unpopular to say, but not everyone's meant for real estate. Not everybody's meant to be a salesperson, meant to be in real estate, doesn't make them wrong, doesn't make me right. This business isn't for everyone. And I think I struggled as a leader for a long time trying to fit a square peg in a round hole and trying to, well, if you come join me, you'll be successful. That's just my ego talking. And so I just had to put my ego to the side and realize, you know what the stat, the national stats of 87% of real estate agents fail. Who am I to say if you come join me, I guarantee you success. That's just unrealistic. And so what I believe in, and my coach, my good mentor, my good friend John Chapla taught me that is my job to help facilitate the environment for people to choose to be successful, but the choice is theirs. And some people just choose not to do the work that's required, and that's fine. I still love them, but I have to uphold the standards and the integrity of our organization so that we can continue to grow and change lives of people through real estate and so on. That being said, 28 agents is the lowest we've been in quite some time, but we are ramping back up. And so that will continually grow. But if you think about it, 28 agents that are on pace for 800 transactions, that's pretty good.
Speaker 1 (00:30:51):
Yeah, that's great. What kind of staff do you have supporting them and what has that looked like over the years? Have you tracked a staff to transaction or staff to agent ratio, or is it as needed? How have you thought about building up the, I assume you're like your first two or three hires was like, well, heck, if I'm going to get past 74 myself or 72 myself, I need someone to help me do this, that and the other thing. And it was a process of taking off some of the hats that a solo agent has to do if they're going to be solo. But as you started getting past that initial where six or eight people we're super lean and we're kicking butt right now, how did you think about hiring through that process? And is there anything that you thought went really well for you that you would advise others on or things that you maybe didn't do correctly that you'd like to make sure anyone else could avoid that mistake?
Speaker 2 (00:31:48):
Yeah, I've got all kinds of mistakes I can share for sure. So let's go back to the very first hire. My very first hire was an assistant. I think that most people get it wrong. They hire too early. You can't out leverage the hard work, quit trying to delegation is the popular term. And I just think too many people are sitting in their ivory tower and just cracking the whip and saying, you do the work, you do the work, and we got to do work too. I just think that let's be careful not to out leverage ourselves. That doesn't mean you need to do all the monotonous tasks yourself. Don't mistake what I'm saying. But also there's some people that believe in just outsourcing everything and I'm somewhere in the middle. I think that there's smart leverage and there's unsmart leverage because you can become too disconnected.
Speaker 2 (00:32:38):
And so the normal trajectory that I have seen is you hire admin support, then you hire buyer's agents and you become the listing agent and then until you replace yourself and you continue to grow that way, and then you have transaction coordination, listing coordination, maybe some marketing support. And that's kind of the growth path for quite some time. In our growth path, we had a pretty consistent basis of two to one, meaning we had one staff for every two agents, and it was give or take, it was a rough math, but through our growth path that was pretty steady. But then the compound effect comes into play. And as you grow, the complexities of scale allow you to maybe you can have three or four to one, meaning three or four agents to one staff because once you have your processes and systems in place for transaction coordination as an example, that transaction coordinator can work with more agents because of the complexities of scale.
Speaker 2 (00:33:39):
And I think that depends on where you're at as a business, but not, again, it works differently for everybody and everybody does it differently. And so just make sure that using your business acumen to make smart decisions. But mistakes that I've made in growth from a staff standpoint, higher when they're at 80%, not when they're at 120%. I think too many people wait because training takes forever and it is such an integral part and process of growing and scaling. You have to have people that are cross-trained, cross cohesion, and you want to make sure they're trained properly. You can't just throw them to the wolves. And so again, real estate is a very sophisticated business. There's a lot of moving parts to learn, and I think it's important that we realize that we set up people for success. And so when a transaction coordinator as an example is that 80% capacity, it's time to hire your next one and then shadow and train so that when they're at a hundred percent capacity, they can just pass the torch and it's not waiting until they're at 120% capacity.
Speaker 2 (00:34:44):
They're already overloaded, they're overworked, they're stressed, and now you're going to throw in someone else to train. That's where things go awi. And I've done that over and over and over again and it's taken me a long time to learn that lesson. So learn from my mistakes. And when you're able to do that, it allows you to grow and scale much easier with way less friction, I think. I believe, again, I have all kinds of recruiting machines in place and different things to continually bring in new great, hungry people to our organization, but the staple is the operations. That's the foundation. That is what keeps the wheels turning in the background. If you don't have great marketing for Legion, you don't have great listing coordination for all the marketing that goes on with the listings. If you don't have great transaction support to help with the client experience from contract to close, it makes the agent's jobs a lot harder and also makes it more difficult to recruit. And so I think it's just important as you scale, just make sure you're looking at your business, step back, look at it from a 30,000 foot view and make sure that all of the parts are moving in the right directions and that you are preparing for growth and growing before you're ready to grow, if that makes sense.
Speaker 1 (00:35:59):
Yeah, I appreciate that 80% versus one 20% caution. I also appreciate the idea of cross training. So in case you find yourself at 90% or a hundred percent just to kind of stay in that you can maybe get away with it a little bit because someone else can help out a little bit. I also appreciate your don't out leverage yourself. Don't be afraid of doing the work yourself. I mean, that's part of it too. I also, we've had this conversation a couple of times on the show, which is in the beginning the ratio is a lot higher staff to agent, but once we built it out, then that's the healthy foundation to go on. I kind of teased it a little bit in the intro. We talked about it before, but you still have a very significant role in operations. Talk a little bit about that.
Speaker 1 (00:36:46):
Is that a strength and a passion of yours? Is that some of the people I thought maybe would grow into that? It is just not in their interest because we've had that story on the show too, is the assistant who was with me before is now my director of operations and sales or something like that. Talk a little bit about only because you raised it as such a critical component and it's the foundation, it's the piece on which we can legit scale a business. And in that scale, when you push to four to one ratio, that's where you're assuring a greater likelihood or even a greater amount of profitability, which is obviously what everyone wants. If you're not looking at profitability, if you're not looking to get back to profitability, if you're not looking to push profitability, I don't know what you're doing. So anyway, with that long tee up, speak a little bit to operations and your role in it and maybe how as you're getting questions from other team leaders, what are some of the operational zones that you'd like to call some attention to? Sure.
Speaker 2 (00:37:46):
Yeah. So first I want to speak on the profit. I just want to be very clear. We are all in the real estate business. We are in the for-profit business. There is nothing wrong with you making a profit. I'm very open and honest and upfront with our team on, here's a great question. If you're a team leader listening to this and you're struggling having this conversation with your team just to ask a great leading question, raise your hand here if you want to make money. And when they all raise their hand, be like, awesome. Is it okay if I make money too? Cool now that we realize we're all on the same page, we're all here so we can make money, let's make sure we can make money together. And when we were working in the same direction, just makes it so much easier that you don't have to fight about splits and it's just not worth it.
Speaker 2 (00:38:26):
And so just make sure that you're transparent with that because there's nothing wrong with you wanting a profit as long as you're providing the value and the opportunity to the agents. You need to have a profitable organization so that they have a secure place for them to support their families. But now back to the COO role. So I am the standing COO for our company and you asked if it was a passion of mine, and I almost laughed out loud because I absolutely am a terrible COO. It is not a passion of mine, it is not something I'm particularly great at, but it is something that I out delegated in the past and it is such a critical component that me doing it, knowing the importance of it is better than the wrong person doing it. And so it needs to be done. And again, you can't delegate your pushups, right?
Speaker 2 (00:39:17):
You've got to do 'em yourself. And if it's something that is a big gap in our organization that needs to be done, I believe there's only one leadership style and that is servant leadership by example. We've heard of them a part servant leader with lead by example. I believe you combine them and that's the only way to lead people. And so what is the biggest gap in our company? Where's the biggest weakness? How can I jump in and fill it? And so I've been doing that for a few months now in our organization and we've got the train back on the tracks and we've fixed a lot of gaps and we've actually been able to lower expenses and increase the output just because we had better leadership and better structure and better accountability in place. And above and beyond that, the operations members that I love to death that are my task oriented checkbox, people that think goodness, they exist, are so much happier in their roles because we have adopted a theme that clarity is kindness.
Speaker 2 (00:40:14):
I think too many people in a leadership role sugarcoat things. And yes, you don't need to be a jerk, but you also can speak very directly on what is expected. So many, I believe that anytime two humans have a disagreement, it is always a result of unmet expectations every single time. And so what I pride myself on as a leader is I want to leave with clarity. Here are my expectations. I don't want to set you up for failure. I want to leave here and I want to be kind to you and be clear on what I expect so the next time we meet, we can have a happy meeting. We're all on the same page and we actually move the needle forward. And it was a little rocky for a little while, but now everyone's like, holy cow, look at this momentum we've gotten. Look at this clarity that we have. I understand my job better now than I have in the three years that I've been here just because of these conversations. And so if someone is struggling with that in the operations or even with agents, just remember this phrase, clarity is kindness. And so to be unclear is to be unkind. And if you truly care about your people, which most leaders do, you have to have those tough conversations so that you can have the proper expectations for what the next steps are.
Speaker 1 (00:41:35):
Really fair. And I would extend that too to clients as well. I think this idea of setting, managing and exceeding expectations is the key to success in general. I love that you called out expectations there. Over the years as things have kind of ebbed and flowed, mostly flowed for you,
Speaker 2 (00:41:57):
There's been ebbs too.
Speaker 1 (00:41:59):
Yeah, totally. Of course. What's the most number of direct reports you've carried and what is your kind of comfort zone? I can imagine all the different kind of got minute agent type questions that come up. I know there are mechanisms including regular meetings and things where you can kind of get out ahead of those or create a format or a controlled environment for that. But I can imagine a scenario where you've got maybe almost the entire organization ready, willing and able to call you with a question or something. Talk a little bit about that because it sounds like a lot, especially with the operations side.
Speaker 2 (00:42:35):
So there's a couple parts there and it's a journey. So I didn't get to where I'm at overnight, but right now in my organization I'm the CEO on the visionary, I am the COO and I also oversee the visionary parts of our marketing department. We also have a property management company. I'm also a coach. I also run a pod. I could keep going. And so I wear a lot of different hats, but the amount of God minute questions I get in a week is probably less than five. And I think it is because I have developed the skill and realization that we teach people how to treat us. And so I think too many people think when I'm a leader, that means that I got to be at everyone's beck and call. And I think that that actually does people a disservice. I think most people don't lack resources, they lack resourcefulness.
Speaker 2 (00:43:32):
And so when someone comes to me, and this is a principle that you can scale in any business, when someone comes to me with a problem, I practice the 1 3 1 method. You have one clear problem, you bring me three potential solutions and then the one that you think is best and why. And if you are not prepared to bring me a clear problem, three potential solutions with the one that you recommend, then I can't help you. You have not thought about the problem enough for me to actually help you through the problem. And I think a lot of times if you just implement that the right way, it takes, again, it's a process, but then people respect it and then they don't need to lean on you for all the answers. There's another part to that too, and I empower people, is it legal? Is it ethical?
Speaker 2 (00:44:19):
Is it best for the client? Is it best for the company? If it fits those four criteria, you don't have to ask me do it. I let that framework and I empower them to make decisions. And if it fits those frameworks that you think it's best and it comes back to bite us, I'll deal with the repercussions, but I don't want to be the bottleneck for our organization. And so there's that piece. There's also how are we empowering and building an environment of trust and safety in our go back to culture of that. They're not afraid to make a mistake. One of our core values is initiative. I tell people all the time, if you make a mistake, that's probably a good thing. That means you went out on a limb, you did something you thought was in the best interest of the company or the client and it caused a problem.
Speaker 2 (00:45:09):
Cool, now we can provide a solution and we can move forward. But I think too many people get stuck and they wait to be told what to do. And that's where organizations stop growing. And I think it's important that we empower our people to make decisions upon for themselves and we have them. This is our theme right now for the year. We have a theme every year. Our theme for 2024 is we are solutions focused. I believe what you focus on expands. You look around the real estate world these days, there's problems everywhere. We could talk about problems all day long, but problems aren't what I'm focused on. I want to focus on the solutions. And if I focus on the solutions, then I find more solutions and then I get a little momentum in my life. I get a little momentum in my business, and then it helps me build confidence and it's a spiral in the positive direction. And so I just think that there's a lot there. So the 1, 3, 1, trust and safety and also what if I told you that a lot of leaders hold things close to the vest because they want to feel important?
Speaker 2 (00:46:16):
I believe that I want to treat everyone. I want to give everyone everything. I give it away. I want to give them all the knowledge that I have, all of the information. I want to give them everything so they can go and do real estate without me. I want to prepare them. They can do it without me, but I want to treat them so well that they don't want to leave. And that's my leadership philosophy. And when you just give it all away and you empower them to make the right decision with you, give them a framework and you treat them when they do have a problem, that you are there to help and support and run it to the ground with them. If it fits your criteria in the framework, then when you get a problem, it's an actual good problem that actually needs to be solved, you probably should know about. And your organization isn't, the growth of your organization isn't stopping when you're not there because you're empowering other people to make decisions.
Speaker 1 (00:47:08):
So many good tips in there. And that 1, 3, 1 immediately, I mean I'm sure it just preempts questions too. By the time you're halfway through the 1 3 1 before bringing it to you, you either solved it yourself or you realize there's someone better to bring it to her to have the conversation with. At the risk of running along, I would love for you to speak to the solo agent who is not sure if they're in the right place, but they may be scared on the face of a split. They don't necessarily understand the team dynamic. They might think that they need to give up all their individuality to become part of this bigger thing. Speak to the solo agent who might actually be happier and more productive on a real estate team.
Speaker 2 (00:47:53):
Yeah, absolutely. I want to go back to the previous one, something popped in my head and then we'll absolutely. I think another mistake that leaders make is they don't provide, they don't build enough confidence and they don't instill that borrowed belief into the people that they're leading to where the people that come and have these God minute questions. What I have found is a lot of times they're calling, they're saying, Hey Ethan, I have this question on 1, 2, 3 Main Street, and it's a silly question. They already know the answer to. What they're really saying is, Hey, Ethan, I'm writing a contract. Aren't you proud of me? And I think that if we can just realize that as leaders, that we can acknowledge them and give them, for lack of better terms, give them a cookie before they ask for a cookie. Just we have to appreciate our people, acknowledge them, recognize them, reward them so they don't have to seek the validation from you as a leader.
Speaker 2 (00:48:49):
That will get half of your God minute questions out right there. And so start finding a way to recognize, reward and validate your people before they have to reach out to you for validation. Alright, so solo agents on the team. This is great. I love this. I have these conversations all the time and not necessarily a debate, but I'll have this conversation with anyone because I just truly believe, and I've seen it over and over and over again. There are very, very, very, very few people that wouldn't be better off on a team. If I was not a team leader and I was selling real estate, I would be on a team. It provides leverage, it provides support, it provides coaching, it provides training, it provides insulation, it provides everything that you need to be successful with almost no risk if you are on the right team with the right track record, with the right systems, the right leadership, the right coaching, training, accountability, all these teams that I know have all of these things.
Speaker 2 (00:49:47):
There's a proven track record that if you do a, you will get to Z. That is not guaranteed in the sales world or in real estate, but if you join the right real estate team, I have a playbook to sell our standard on our teams to sell 20 transactions in a year. That is what it takes. That is what it requires to be on this team. And I have a playbook that if you follow it, you will sell 20 plus transactions a year. No one. We've had this playbook for a year and a half. No one that follows that playbook to at has sold less than 20 homes in a year. It is proven over and over and over again. You can't tell me that as a single agent, the individual agent, that you have that playbook because you have to generate your own leads, you have to build your own branding, your own marketing.
Speaker 2 (00:50:33):
Who's going to manage your transactions, who's going to manage your CRM. There's just so many moving parts to this business that if you are on the right team, if you're on the right team, there's so much opportunity for leverage, for more time and for more money. Let me just tell you a few quick stories. So this is the, literally, we have independent agent that's joining our team next month, and this is the conversation that I had with them. I said, what is more important to you? How much money you make on your next closing or how much money you make at the end of the year, which is more important? Well, how much I make at the end of the year? Okay, awesome. If you make more money at the end of the year and I can give you more time back and I can give you more training and I can give you more support, would that be a win-win for you?
Speaker 2 (00:51:21):
Absolutely. Okay, here's how we can do that. Literally you can do that. And what's really cool when you have a team like ours, I have stories that I can tell. I have an agent that joined my team. They were in the business two years. They came and joined our team. They were single agent, they doubled their income in year one net. They doubled their income again in year two. That is Forex. Their income in two years from being a single agent making way higher of a split. But what did they actually make in their pocket? I have agents that have been able to buy their first house that are buying investment homes that are making double and triple the amount of money that they made before agents that were going to get out of the business. And they came and joined our team and now they're leading our organization.
Speaker 2 (00:52:06):
There's just so many stories that I tell you from our personal team and from people that I've coached, that if you just join the right team for the right reasons and you're a team player, it's not about the split. There's an equation that I developed. It's time, value, and money. How much time are you spending? What is the value that you are getting at the end of the year, not the transaction at the end of the year? How much money are you putting in your pocket? And if you were really to think about that equation, if you're willing to contribute to a team and be a part of the right organization, again, there are exceptions, but most people would be way better off. They would have more money in their pocket, they'd have way less stress in their lives. They'd have a culture and a community of family feel if you're in an organization like ours, and you'll make way more money.
Speaker 2 (00:53:00):
It's a no-brainer to me just because I've seen it from both perspectives and I'm talking as a team leader, but I say this to my team all the time as a team leader when I make decisions first and foremost, is it with our principles? Is it with our values? And the third question I ask myself is, if I was an agent, how would I feel? Because I've been an agent that was taken advantage of, that wasn't appreciated, that had money stolen from me. And so I do this for them as my business partners. And so it's set up for everyone to win together. And I think that if you're on the right team with the right opportunities to have that proven track record, it's just a no-brainer for most people to join a team. They just have to be willing to set their ego to the side and realize that they're going to join something that is way bigger than themselves.
Speaker 2 (00:53:53):
And if they want to be a part of something bigger that is making a bigger impact, then a team is the way to do so. As an example on our team, our core focus is changing lives. That is what we are focused on. We just happen to do that through real estate. And so changing lines are, we help people that are first time home buyers. We help someone go from homeless to homeowner. We have stories of people that are in so much financial distress that we're able to give them hundreds of thousands of dollars of equity in their home by selling. There's just story after story after story after story of us helping people through the biggest purchase or sale of their lives through real estate. Not to mention the stories of success of agents, of team members on our team that are making life-changing money. They're living lives beyond their wildest dreams that literally they just went with us on our team to an all-inclusive resort, first time out of the country in Mexico to celebrate our successes of last year. You can't get those things and those feelings without a community of people rowing in the same direction, working for a bigger mission and a bigger vision than just the next transaction.
Speaker 1 (00:55:02):
Okay, A couple things. First of all, I'm so glad I asked that question. Second, I can imagine how full your pipeline is because sold. And then third, I don't want anyone to miss the fact that you just mentioned a trip to Mexico with the team all inclusive on the success in 2023, which I don't think anyone is going to be crazy psyched 10 years from now. Like, man, you remember the Go-go year of 2023. So anyway, that's incredible. It's fantastic. You've given me almost an hour of your time. I super appreciate it. I know how valuable it is, and I know other folks watching and listening are appreciative too. But I've got three closing questions for you, and you can answer one or the other or both if you want. Some people choose to do both. But the first one is what's your very favorite team to root format besides your own real estate team, or what is the best team you've ever been a member of besides your own real estate team?
Speaker 2 (00:56:05):
So my favorite team to root for is my daughter's basketball team. I'm assistant coach for that, and it's such an amazing experience. So I said earlier, I have a lot of jobs. I have a lot of hats that I wear. My favorite hat by far is being a dad that's talk about life changing. That's why I do everything is for them. And that's what keeps me motivated and going is that I'm leaving a legacy for them. As an example, go on a quick grant here, but I travel a lot for my job and I work a lot of hours and I think a lot of people listening to this that are on their success journey, sometimes we have to make sacrifices and I think it's very, very important. One of the big lessons that I learned in giving up that time with the people that matter most is bringing them into the conversation.
Speaker 2 (00:56:57):
So what do I mean by that? My daughters and my wife know why I'm going to these events. They know the core focus of our company. Daddy doesn't go to work. Daddy's going to help people today. Daddy's going to change lives. Daddy's going to speak to 2000 people next week in Cabo so that he can help them transform the trajectory of their lives and they can live the lives beyond their wildest dreams for themselves and their kids and their families. And that transcends into your environment. And instead of work being a negative thing that daddy has to go to, they're now rooting for you. And so whatever your journey is, and if you're a parent, which I know a lot of people are, it's a struggle being an entrepreneur and a parent. I would just invite you and encourage you to bring them into the conversations and let them know that you are spending time away from them so that you can help them live a better lives.
Speaker 2 (00:57:51):
I bring in, say, remember the Disney World trip that we went on? Daddy has to go to work so that we can enjoy those times and I can take a whole week off and not even answer my phone because of the work that I put in to be able to do so. And just things like that to bring our families in. I think sometimes we separate them, we think they don't notice, but it reminds me of something Ed Mylet says a lot is most lessons are caught and not taught. Most lessons are caught and not taught. And so what are you teaching your kids through what your actions are? And it's so important. And other than my daughter's team, I do have a favorite team, go Chiefs. I'm a chiefs fan being here in Missouri, so they got a little dynasty going now, so I got to root for the chiefs.
Speaker 1 (00:58:34):
Yeah, they really do. That was great. What is one of your most frivolous purchases, Matt? Or what is a cheapskate habit that you've held onto even though you probably don't need to anymore?
Speaker 2 (00:58:45):
Oh man, I am so cheap. How many do you want, Ethan? People make fun of me all the time. I will do anything to save money. I didn't come from money, and so it's still running jokes with my family, with my lifelong friends that I will do. I don't buy the best of anything. I always look for the deal.
Speaker 1 (00:59:10):
Have you ever tried to haggle on a price that really wasn't negotiable?
Speaker 2 (00:59:14):
Yes. Oh, everything. My wife will let me.
Speaker 1 (00:59:17):
We don't do that.
Speaker 2 (00:59:17):
We don't go to a store with me because I'll try to haggle with everything. So we bought a car a couple years ago and she walked out and said, I'm leaving. You are embarrassing me. I'm like, I'm just trying to negotiate a deal here. She's like, it's $500. Just give them the money. So yes, a hundred percent.
Speaker 1 (00:59:34):
Okay. Last one. What does it look like for you to invest time in resting, relaxing and recharging? Or what does it look like for you to spend time learning, growing and developing?
Speaker 2 (00:59:47):
To be honest, those are kind of one and the same for me. So I enjoy learning. And so I recently started doing cold plunge every single morning. The forced suffering of forcing myself to do something hard each day, plus the health benefits. I absolutely love it. I work out every single day. I'm on a health and fitness journey, and while I'm working out, I listen to some sort of podcast, either your show or Ed Mylet or Andy Ella or John Chela, or I just listen to something that is good for me that I can learn from, that I can grow from. And I just think that for me, recharges, hearing other people's success story, hearing other people's struggles and how they overcame them and how it can inspire and motivate me. Or I hear someone else that's sharing a tactic that will help me solve this business problem. To me, that stuff is fun. That's what I enjoy, and so me learning and growing and developing are also rest in relaxation at the same time.
Speaker 1 (01:00:49):
Yeah, it's funny. It didn't take very long. I thought. Thought that I would get, it didn't take very long for those things to merge. It started, I think, on episode three, and it happens all the time now. So I might have to split those apart or make something a little bit more dramatically different. But really appreciate that. By the way, I also enjoy listening to all or nothing in real estate. If someone wants to check that out or they want to learn more about you or any of the work that you're doing, where would you send someone who spent an hour with you and me?
Speaker 2 (01:01:16):
Yeah, so if you're interested in following my podcast, I do an episode a week, no ads, a hundred percent free, just a value add, all or nothing in real estate. We have a website, all or nothing in realestate.com, or you can find on any major platform. Whatever you listen to your podcast, go check it out. You can find me on social just Matt Smith, or if you're interested in a coaching opportunity, we have a free discovery call that I'm happy to have with you. Just reach out to me, send me a message on social media. Send me a message on our website, and I'm happy to have the free discovery call to see if we're a good fit. Maybe I can help you through some of the struggles that maybe you're facing right now in real estate.
Speaker 1 (01:01:51):
Awesome. Well, you got me fired up. I can only imagine what it's like to have you go deep with a person and the business they're trying to build for folks, watching and listening, that's all linked down below everything Matt just mentioned. If you're on YouTube, just hit the see more information or whatever down in the description area. It's down below in your podcast app. If you're watching or listening on the website, realestate team os.com, all those links are down below in the description. Take advantage of it. Matt, I appreciate you so much. I'm glad we could have this conversation. I've got a lot more questions for you, and so we'll have to do it again. Alright, thanks Ethan. I appreciate it. Cool, thank you.
Speaker 3 (01:02:28):
Thanks for checking out this episode of Team Os. For email exclusive insights every week, sign up@realestateteamos.com.