Erica Christoffer is a multimedia journalist and contributing editor with REALTOR® Magazine. In addition to writing print and online articles, Erica oversees the magazine's Broker to Broker content, co-manages the 30 Under 30 program, and manages the YPN Lounge. Connect with her via email: firstname.lastname@example.org.
Newer Kids on the Block
Starting a brokerage provides owners with greater control over their business and a steep learning curve.
May - June
Opening a brokerage can be as nerve-racking as it is thrilling. Inevitably, new brokers do a lot of their learning on the fly, in the moment. The lessons are fresh for these three Chicago broker-owners who have all launched their business within the past five years—in one instance, just five months ago. In part three in this series of broker conversations, the three entrepreneurs gathered at The Gwen Hotel in downtown Chicago to discuss their early accomplishments and growing pains.
Building a Business Structure
Mike: What’s the biggest advantage of having the RE/MAX name behind your business?
Augustina: Coming from a family brokerage—Campos Real Estate, owned by my father—we were looking for name recognition. The name gives us credibility and awareness. We now have 30 agents.
Melanie: And you manage them all?
Augustina: Yes, I’m the managing broker and co-owner. I’m pretty sure you guys have the struggle of wearing many different hats, whereas I have an entire management team—my dad, Jaime Campos; my sister (also named Jaime); and Mark Santoyo, our business partner, who’s in charge of training.
Location, Location, Location
Augustina: We started with what was going to be a mobile-friendly office where agents were just going to pop by. But we found that people actually wanted to be in the office, so about a year and a half ago, we moved from an 800-square-foot location to a 3,000-square-foot location, which has a combination of work stations and private offices.
Mike: I think that’s something a lot of brokers are kicking around right now. Nowadays a lot of agents are on the go, popping in and out, but at the same time there’s pressure to have a big flashy office.
Augustina: We do have mobile agents. But we have more teams now, too, who want their own space.
Melanie: I just started Jan. 1, and I don’t have plans to have an office. I want my name to be on every deal. I’m the rainmaker, and I love putting my own spin on everything.
Mike: I started the same as Melanie, on my own. In terms of how you run your business, Melanie, you’re light-years ahead of 24-year-old Mike. I had never worked for a big firm. I worked for a leasing agency and they were getting 70 percent of my commission.
Melanie: That sounds like a scam.
Mike: But rental agencies are a different animal than traditional brokerages. Agents can close 10 or 12 leads a month. I was just doing rentals at first. Then one day a buddy said he was looking for a place and his budget was $300,000 to $400,000. I figured it out as I went along. I got all my own stuff set up: a CRM, marketing content that’s relevant for my client base, systems to automate the business. At the end of 2013, I opened an office with four agents.
Sell or Manage?
Augustina: You’d be surprised at the number of brokers who think they’re making money because they’re still involved heavily in transactions, but they’re actually losing money on their brokerage.
Mike: That was my 2016. When I took myself out of it, Center Coast Realty (at that time, Access Chicago Realty) lost money. I decided to refer out my business and focus on running the brokerage. I’m looking at how we’ll continue to provide value in 10 years.
Melanie: Can we talk about culture? I want to know how you attract people.
Mike: One of my tricks is to let people experience us. Every two weeks we get together for coaching. If I’m talking to potential recruits, I’ll bring them in for a team meeting and have them grab coffee with our agents. This lets us see if they mesh with the room.
Augustina: Have your mission and vision statement down on paper so you can hand it to agents so they understand your company.
Mike: We have core values, and I have questions for each one of those to test people.
Melanie: This conversation is really making me take a look at the direction I’m going.
Augustina: I highly recommend you first decide what your business model is going to be and stick to it. If you want to focus on your transactions, then go that route. It takes you a while before you feel comfortable giving out referrals.
Melanie: It feels like I’m giving away my children.
Mike: A big part is having a process and accountability systems in place.