Are You Running a Team or Running a Business?

Ryan and I recently had the privilege of sitting down with a group of what Keller Williams calls “rainmakers.” I’ve never really loved that term. I would call them team owners, because I think there’s an important distinction between the two. Not all rainmakers are team owners, and not all team owners are rainmakers. Let me say that again: not all team owners are rainmakers.

We had the opportunity to talk about their businesses, our business, how we hold our agents accountable, and some of the systems and processes behind what a lot of people consider a very efficient real estate team. Our units per agent are extraordinary, our culture is amazing, and we genuinely love the people we work with. None of that happened by accident. It has taken years of figuring out what works, what doesn’t, what our standards need to be, and then being willing to hold ourselves and the people around us accountable to those standards.

I am a KW girl through and through. I believe in the product, I believe in the brand, and KW is my home. But I also think some of the terminology we use in this industry gets misappropriated. Having a team does not necessarily mean you are running a business. Some team owners are actually running what I would call social clubs. There are no real systems or processes, very little accountability, no coaching, and no clearly defined standards for how someone earns a place on the team or how they continue to earn the privilege of staying there.

Before anyone gets offended, there is absolutely nothing wrong with building a team around community and camaraderie. Real estate can be lonely. Being an individual agent can be incredibly isolating, and sometimes people simply want to belong somewhere. They want people to talk to, learn from, celebrate with, and lean on when this business gets hard. There is value in that. But that is a very different thing from running a profitable business.

If you want to behave like a business owner, then we need to talk about numbers. Profit and loss, expenses, payroll, production, and most importantly, break-even. I had a professor in college tell our entire class that you should never be in business with someone who doesn’t know their break-even numbers. That has stuck with me ever since, and I think it’s a question more team owners should be asking themselves.

Do you know your break-even numbers? And if you do, let’s take it one step further: do you know your break-even per agent?

Because we do, and that is where a lot of our standards come from. We know how much each agent on our team needs to produce simply to cover the services and support we are providing to that person. We also know what they need to produce beyond that for the business to be profitable. Those are two very different numbers, and if you are going to run a business, you need to understand both.

We love our team dearly, but love doesn’t eliminate math. If I want great administrative staff, an incredible Director of Operations, transaction support, marketing, photography, video, technology, training, coaching, and all of the other things we provide our agents, somebody has to pay for those things. The sales side of the business has to produce enough revenue to support the people and infrastructure that take care of them.

And let’s be real about something else. Salespeople are demanding, and the best salespeople can be extremely demanding. They move fast, they expect answers, they need support, and they expect the people around them to perform at a high level. If I want the best salespeople in my world, then I need the best staff supporting them. I want to pay those people well. I want them earning salaries that are commensurate with the work they do, and I want to treat them even better than I pay them. I want them to have the tools, support, and environment that make them want to stay here. The only way I can continue to do that is if our salespeople perform.

That is why accountability isn’t mean. Standards aren’t mean. Expecting someone to produce enough to justify the resources being invested in them isn’t mean. It’s business. When someone on our team isn’t performing, we coach them. We work with them. We figure out what is going on, where the problem is, and what needs to change. But eventually, they have to perform. If they consistently cannot meet the standard that has been set, they jeopardize their place on our team. There are consequences for not performing, just like there are rewards and opportunities that come with performing at a high level.

That accountability is a big part of why we produce at the level we produce. You can have an incredible culture and still have high standards. You can love your people and still hold them accountable. You can care about someone personally and still recognize that professionally, the numbers have to work. Those things are not mutually exclusive, and I would argue that some of the healthiest cultures are created when people know exactly what is expected of them and know everyone else is being held to the same standard.

So if what you want is a social club, build an amazing one. Create community and give people a place where they belong. There is absolutely value in that. But if you want to run a business, be profitable, employ exceptional people, compensate them well, and create real opportunities for the people around you, then you need to know your numbers.

I would start with one question: What is your break-even per agent?

If you don’t know the answer, DM me or schedule some time with Ryan and me. We’re more than happy to have that conversation.