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They’re fools to make agents 1040 employees, rather than 1099 independent contractors. For a second reason, 1040 employees are going to be the death of all corporate entities. But the first reason is in the headline: No rainmakers, no rain.
You can see they understand this simple fact: The pay plan is commission plus a draw, the scheme all corporate sales teams use to attract and retain dedicated plodders.
But straight commission sales separates closers from losers just like that, with zero management intervention. That’s why real estate brokers like it so much.
And I think that illuminates the folly of taking fintech seriously. Who doesn’t love a better pen – but who believes a better pen will make you a better persuader? Technology solves paperwork problems very well, and I would be more impressed with technology vendors if they put more attention there. (Hint: Title and escrow: Rich, ripe, ready.) Technology addresses people problems poorly – a fact it is perpetually incapable of discovering.
Brian Brady pointed out to me that lenders live on Realtor marketing. That’s not wrong, it’s reasonable. Title, escrow, inspectors, tradesmen and home-warrantors all depend on Realtor referrals, which they can farm out only because they have already surfaced the buyer, seller or investor. You can’t buy your date a cocktail until you have a date.
So it’s the other end of the food chain that concerns me – not fintech but leadgen. Realty.bots whose sole business is to get in front of your client before you can – so they can sell access to you – are not your friends.
For what it’s worth: Of the big-name iBuyers, Zillow’s solution to abandoned shopping carts seems best. Instead of using salaried and lawsuit-curious employees to upsell more lawsuit opportunities, pitch the now-useless “leads” to starving Realtors. For 35%! Who has the suckers figured out in every sucker-bet they proffer?
Meanwhile, fintech: The marginal value of a better pen is a commodity price. There’s an upside in title insurance, and any acceleration of the process is welcome. But the limit to what tech can do is right there in the headline: No rainmakers, no rain.
If you list, you last? iBuyers are willing to blow billions proving that homes are sold well by hungry entrepreneurs, not domesticated wage slaves.
Tech sells cheaply but poorly. Most marketing money is simply wasted. Accordingly: If you can sell, you’ll survive.
