Justin Stoddart 0:00
Hey, welcome back to the Think Bigger Real Estate Show. I’m your host Justin Stoddart
partnerships. Are they a good idea, are they not? Today we’re going to talk about how partnerships can leverage can be a powerful source of leverage to allow you to take your business to the next level. I want to, first of all, thank James Becker, owner and founder of fusion growth partners for being on the show today. James has spoken at Inman before. He’s built Fusion Growth Partners and is a business incubator for emerging mega agents. You probably have not heard that before. So we’re going to talk all about what partnership could look like. James, first and foremost, thank you for being on the show today.
James Becker 0:38
Thank you for having me. I’m looking forward to it.
Justin Stoddart 0:40
Yeah, good stuff. So, James, we were talking here before, and I kind of wish we would have started the broadcast a few minutes ago because so the stuff that he was sharing was absolutely fantastic. So I’m hoping to be able to pull that out of him again.
But here’s what I think of James, when I think of a partnership, or how most real estate agents think of a partnership is they think, boy, I’m getting busy. Susie over there in the office doesn’t look as busy. Hey, Susie, why don’t we team up and let’s go list. I go on vacation, you can cover my stuff, you go on vacation off cover your stuff. That’s about as complex of a partnership that you typically see in real estate. And really what you guys are doing is coming in creating partnerships, almost investing in real estate agent businesses to take them to the next level, like less of a mom and pop shop, and more into a really established business that offers big value to the clients. So I’m interested really interested in having you share kind of your story. How did Fusion Growth Partners come about?
James Becker 1:40
Well, I started selling real estate back in 1989, we had a great market in 1989. And then we had Desert Shield when we had the first Iraqi war. We had boots on the ground, the market literally went to a stop. I was newly married, I have a pregnant wife, and I needed to pay some bills. And so I sat down and I cold called until my fingers bled. And I did very well doing kind of the mike ferry process. Yeah. And. And back in 1990. Before there are mega-agents, my best year I did about 65 transactions with one TC. And those do all the prospecting myself, I was in 1% of the agents across the country as far as volume was concerned. And, and then after that last year, then 1997 year I was just completely burned out. And I hadn’t leveraged it, everything in a was
the amount of business that I did was strictly correlated to the amount of energy that I had every day that I could put into prospecting, burnout being and so I started thinking about, okay, need to do something different. And I opened up another business, that business was kind of Fusion 1.0 was not successful. And I ran into a guy running a mortgage company who became a mentor of mine, I shut down my business went to work for him, learn some corporate structure and some additional business stuff for five to six years and then opened up future.
Justin Stoddart 3:27
So talk to us a little bit about what Fusion offers. Again, it’s very different than just offering an agent or even offering an assistant, but when I went through the presentation really can understand your model, I was super impressed when I thought all the stuff that I try and recommend to real estate agents that they should do to grow their business. I mean, it was you know, it could be a menu of like, dozens of things to really get their business showing up in the right places, with the right touch with the right look. And like I think about every good idea that I had heard or ever promoted, you’re saying, we do that, with companies invest in companies to help them on day one, be able to turn the switch and have this stuff rolling. Right?
James Becker 4:07
Right. Well, not day one, it takes 60 to 90 days to build out a factory. And that’s one of the things that keeps agents from doing and there’s a huge commitment to building up all the systems and the processes so that they can run on a regular basis and have consistency. We believe the number one reason why people don’t have long term growing sustainable businesses is the lack of consistency in just the fundamentals, and the basic business development stuff. Because the works, they produce some business, they get busy, they stopped doing that. And so they’re in business, and they’re out of business, they’re in business, and they’re out of business. And so for us, we want to build up this particular factory. So it’s not particularly day one. But when people ask us what we do, it’s impossible to explain in five minutes, but the best way to explain it is most of these people have been to a family reunion or mega agent or Tom Ferry seminar. And they come out of those seminars just like if I set this system up, and this system up and this system up, man, I’m going to kill it because I see these other agents that have done that. And then what they find out is six months later, they’re signing up for maybe the same seminar, or very similar seminar and they haven’t executed anything on a consistent basis. That is the problem that we solve. We look around and I cannot see or find one business, it’s one person that does everything themselves. That’s a healthy long term business. And so but that’s what we do, as agents, we tried to hoard all of the money ourselves, and we’re going to do all the work ourselves, keep everything ourselves. And what ends up happening is you have a very unstable, unsustainable business model, that, you know, someone gets sick, or they’re hired, or they’re burned out the businesses
Justin Stoddart 6:05
that you know, grow. So, you know, I couldn’t agree with you more again, I get the good privilege of day in and day out spending needed spending my days,
my days sitting next to agents helping them become more consistent with systems in place, and by night thinking about how I can help them improve that. And what I mentioned that I think is really interesting, is it that agents unwillingness, or at least lack of education on what it takes to actually scale a business that is sustainable, that it’s, you can’t look at the commission check as income, right, or as your paycheck rather.
Like its revenue.
James Becker 6:44
Revenue. It’s not a paycheck. That’s such a good, such a good way of looking at, I’m gonna have to borrow that from you. Please, paycheck, its revenue, you’re absolutely correct.
Justin Stoddart 6:57
But yeah, they see it. And I think that’s why many agents go right on kind of the further end of the spectrum, like forget about taxes, there’s, they’re used to coming out of a job where when someone gives you a check that you put it in the bank, and that’s what you get to spend. But there’s this education of what about the taxes. And then what you’re saying is there’s this other component, that if you were actually business savvy, or like any scalable business, you would take a percentage of that and gladly invest it back in the business and people systems tools in order to get you to where that service you just offered number one doesn’t burn you out personally, and continues to allow for a consistent lead generation effort as well as customer service effort moving forward.
James Becker 7:37
Right. Now, I agree with that. So I did some research a few years ago, and I went into US government list of percentages, and you look at the margins that most businesses have the very top, the highest margin by industry was the banks, the banks may more money than anybody else. And it’s about 25% margins that they have if they’re having a good year. Besides that most businesses are below 15%, in margins, and a lot of them are below 5%. But they keep feeding this machine that gets bigger and bigger. And so the bottom number is,
grows on a significant basis. So I’m a big fan of Seth Godin. And I don’t know if you’ve read Seth Godin probably knew I’m sure you’re getting emails every day. Yeah, he’s amazing. And he talks about the difference between the freelancer and an entrepreneur. If you only get paid when you’re doing the work, you are a freelancer. And if you’re building a business, and you’re an entrepreneur where someone else can do the work with me or not, they’re not in brokerage. But in being a real estate agent, the margins and the revenue is so significant, that if you can take 24, five to 35%, maybe even 50%, import that backs into the business, you can build huge, huge businesses, there’s a REMAX organization that I work with the number one agent does about 1.5 million in revenue. And she spends about a half a million dollars in overhead. So half a million dollars in overhead scares the bejesus out of most people. But she’s netting a million dollars in income as a significant income. And there are listings that are being taken without her. There are buyers who are writing offers without her, and she has a real business, she could fly off to Europe for six months and still do the same amount of business. So that’s what we want to encourage. But it’s a process to get there. It takes time to do that. And there’s a mindset. And that mindset is is that, you know, in my speech that I gave the imminent, I said that real estate agents are hoarders. And if you watch the show Hoarders, you end up all alone with just a bunch of crap, right.
And what real estate agents hoard is they hoard their commission, they are not putting back into the not being more generous with their clients, they could give more gifts, they’re not being more generous with the people that work with them, they’re not being more generous with the business development. And if they do that, their pie grows, and their bottom line grows. And that’s what creates a stable business, the more pillars that you have the better chance that that business is going to continue to grow. If you’re relying on like I did initially, on strictly your energy, in your passion, those things wane. And then that’s difficult, you putting yourself in a very precarious position as a business.
Justin Stoddart 10:57
And I was going to say, and you beat me to it that people think well, you know, I’m getting less money. But the pie gets significantly better, better or bigger. And, and quality of life improves as well, right? Because it’s not all on your shoulders, and you’re not having to stay up thinking about it.
James Becker 11:13
Yeah, I’ll give you a good example. So we really believe in two main forms of marketing sphere of influence past clients. Number one, that’s the easiest business to get. And then after that geographical farming, if you own a geographical farm, that’s large enough, that will produce thousands and thousands of dollars of commission. But it takes a while to do that. And we have agents that we say, Okay, look, it’s going to take a couple of years, probably going to be a $50,000 investment over two years. But this could produce 250,000 on an annual basis for you, once you get there. That’s a huge ROI. If you talk to a financial advisor, they would love that. But one of the things that they struggle with this, I tell them, you have to get some signs in the yard. So if you have to work for free, for the first three, four or five listings, do it because once their signs in the yard, then the neighbors are going to see, hey, my friend down the street, use that person, I’m going to call them and that’s the credibility and I think the numbers right now are 76% of people on the call one real estate agent. And then they use that real estate age. And I think those numbers are still the same. So we call those investment listings. And so yes, you are working for free on a transactional basis. But it’s an investment back into the business. And it’s an investment back into
that particular firm, that you have to work for free. But I mean, if it’s a discount, whatever the case, people get stuck on that a discount broker, yes, you’re not a discount broker, but you have to get a foothold in a particular marketplace before you can become the expert. And,
Justin Stoddart 13:00
and part of that, because I do know probably concerns that agents are having is if I discount for one, and it’s in a neighborhood, people are going to talk, oh, my guy charged me this much. And now-now that’s the precedent. But you know what, what maybe could even be said Is it, it might be doing it for free or for less, because you’re investing so much of that first couple checks back into establishing yourself in that community. Right? It might not be in the sense that you’re just kind of your feet, we were just taking so much that fee to gain more market share in that particular neighborhood.
James Becker 13:29
Yes, so almost never Is it a free listing. The point being though, is that when you’re sitting at the table, you have to get a sign in the yard, if you don’t get a sign in the yard, all the advertising that you’re doing, unless you somebody else tries you first, the chances of you getting that businesses are in the future is very, very low.
One of the people that were top producer, when I first started, she took more price listings and than anybody ever and she was by far the best agent in all of the Sacramento Valley, and every other listing was hers. So as a buyer driving around, she has all the inventory. Yeah, as a seller, she’s got more signs out there, that advertisement is critical. I don’t want to focus too much on that. Because I think people go will like, like, Oh my gosh, I’m not going to do that. But the point being is that if you did a half price listing and a kitchen table, and you said I’m going to do this a special deal for you, I’m going to reduce the commission, they get this listing, and you get three or four deals in there. Now you can go back and say I just sold Tom’s property, I just sold out this property, I just sold this person property, you have some evidence of success, success. But now when you’re sitting at the kitchen table, you could charge a full price. Listen, you’re not advertising for it, but you’re doing whatever it takes to get that.
Justin Stoddart 14:59
Tell us, James, what are some of the other kind of things that you guys take care of without being able to do a fully comprehensive list. And maybe it’s even better to direct somebody to have a conversation with you guys, but maybe if you can kind of wet people’s appetite a little bit, as to a few of the systems you guys put in place. So they kind of get an idea, more of what you guys take off the plate of an agent that you’re investing in and incubating their business to become a future mega-agent.
James Becker 15:24
Well, let’s talk a little bit about the philosophies we have. So number one, if we have in our and now in our presentation, we show a picture of a guy by the name of Neil. And we’d say Neil’s in the database. And at some point, statistically, in the next seven years, Neil is going to have a need to do some sort of real estate transaction. And so the question is, how do we stack the deck so that when Neil has a need, he calls us first. And if he calls us first, statistically, we’re going to get 8% of that business. And so in marketing, what we believe is that there’s a couple of elements that you have to have, number one, you must have a theme in your marketing that is consistent. It’s not just I’m the greatest person, in the greatest realtor, it has to be something that is going to resonate. So we like to use progressive as an example. So we all know who flow is, right. And she’s a little quirky, she’s a little weird, but she got the pricing gun, she’s trustworthy, she’s gonna take care of us, we know all of those things. And so that’s the thing that progressive has, the next element is you have to have a frequency, how often do we see the flow, we see flow every day, there is lots of frequency that happens. And then the third element that a lot of people don’t realize is there has to be different modality. So with the flow, we see her in direct mail, we see her on the radio or hear her on the radio, you’re on TV, we see you’re on the internet, there’s a lot of different channels that are coming to us. So we want to build out a marketing platform that has those three things. It has a consistent theme. It has a ton of frequency. And it has a lot of different modalities. And so one of the first things that we start with is a story letter, we tell the person’s story, this is a critical piece, it’s more to let someone know who you are and what you’re about. Because people really want to know how much you potentially would care versus care about how much you know. And then we go into a resume piece. And then we do postcards, we do letters, we then do a video that we’re advertising directly on digital, we have programs where we utilize home bought, there’s about 11, or 12 different platforms that we go into, it all has the same theme, there’s all consistency. And so people that are in a sphere,
Keller Williams that I think is a great organization, and they’ve got this 33 touch, it’s kind of been a Bible. For them in most agents, if you go into these offices are not doing it consistently, maybe one per office is really, really consistent doing it. So difficult to do. But we have a touch program that somewhere between 50 and 100 touches people on a sphere of influence through social media, digital mail, brochures, events, whatever you can think of were in it. So we executed all we set it up, and then we run it and we executed.
Justin Stoddart 18:47
And then just to point out that’s not 50 to 100 emails, right? That would probably be a quick unsubscribe for people. But you’re still saying through all the different modalities, all the different touch points, whether it be direct mail, whether it be digital, whether it be social, you’ve got all these avenues, where you know, I like to say it this way is it. In order for you to sell someone’s real estate, you have to own a piece of real estate in their brain. If you don’t like
James Becker 19:08
you have to have mindshare. That’s exactly right. And emails a very small part of what we do, we do have email because it’s there. But one of the things that we believe is if you over use the free platforms, and you’re going to be turning people off, and when you spend money, people recognize it, I think they see you as a professional when you’re investing into your business, it’s a very subtle thing. But you know, we have people’s businesses really explode. Because when someone is spending money and they’re investing in their business, they set them up, they set themselves apart from the rest of the bank.
Justin Stoddart 19:45
They do. You know, I’m a big proponent right now of helping agents become less salesman, less salesperson, and more advisor. And that I recognize that when you can take all of these functionary tasks off of someone’s plate, all the marketing components, to all the stand in front of people to where you can go be in front of people face to face, your time instead of worrying about the system, or the lack of a system and running around with your hair on fire, you can actually have the time to study the market, you can have the time to study your clients, what they actually want, so that you can advise them, most people probably have the like, like the wherewithal to do it.
The issue because they’ve got so many balls in the air.
James Becker 20:31
Yeah, so one of the main things, when we bring somebody in, we tell them that one of the most important things this is the mindset is that you must become the agent you would hire. And so once you become the agent you would hire in and I’ll explain it this way. Most agents, if they were interviewing five agents, and they were interviewing themselves, and they didn’t know it was them, they wouldn’t hire them, they would hire somebody else
have to develop a package that you’re so proud of, you can’t wait to share, I’m gonna do this, I’m gonna do this, I’m gonna do this, when you’re bringing value because agents themselves as consumers, they buy value, their consumers, their clients are also going to buy value, you get it through the front door, because they like you and they trust you. But then you have to bring something that is going to be significant. So Seth Godin would talk about this, a little bit of the purple cow, you provided more verses, but we believe that agents should do really two things, they should have their staff that’s building and executing these administrative types of things. But then they need to go out and make friends and serve people. Those are the first two most important pieces. And the serving people doesn’t necessarily just meaning serving clients, it means serving your community being out there being involved in charities and not pointing it out that looks I’m such a great person, because people are going to see it, people are gonna introduce themselves to you, those people can then go into the sphere of influence, and then you market to them on a regular basis. But they’re bringing value to me, puts it to a point where the agent feels really good, and they’re willing to put themselves out there. If I can just mention real quick, one of our biggest challenges with agents is that they’re they don’t want to put themselves out there. And I think partly it’s because subconsciously, they know that they’re really not providing the highest level of value that’s out there. And if we can change that initial piece, me and their confidence to source and I think that’s a big part of developing a successful business long term,
Justin Stoddart 22:49
James, where would you direct people to go if they wanted to learn more about fusion growth partners?
James Becker 22:55
Go to our website at fusiongrowthpartners.net
So again, there you go. We really focus on a small segment of the market. It’s individuals that are over $100,000, in GCI, and typically under $300,000 in GCI, and that they really want to grow, they have a passion to grow, those are the people we want to invest in. And that’s what we actually do, we invest and we partner, and we get paid, when they’re closing transactions, a small part of the business that they’re generating in each person that we meet with, we make a determination if we think they’re a good investment. And then we try to work out a deal that’s healthy for them, and healthy for us. And then we go to work and we grow businesses. That’s what we do.
Justin Stoddart 23:54
Super cool. I love it. I’m a fan of grown businesses. I’m a fan of growing people as well. So I want to close with the signature question, James, what is something that you do? Obviously, you’ve created something pretty, pretty fantastic, pretty compelling offer for real estate agents. What is it that James does to position himself to it to intentionally think bigger? to kind of expand your own possibilities? Would you say would be a kind of a key to your recipe?
James Becker 24:21
Can you ask that another way?
Justin Stoddart 24:23
What is it like a practice or a tactic that you do to grow yourself?
James Becker 24:33
Okay, I put myself in, in groups of people, and around people who are willing to tell me the truth about where I can grow. And, and I have a group of friends and I have some really good employees that do not have any issue with telling me where my shortcomings are. Because if I don’t know where those are, I cannot work on them. And, and so I think trying to have self-honesty, is and it’s difficult for all of us. But to me, that’s, that’s the core because if we could really understand where we are, then we can make decisions.
Justin Stoddart 25:22
It’s powerful stuff. I haven’t heard that before. And it is super powerful. I appreciate sharing. So I want to, again, thank you for your time today. Sharing what points out you think bigger real estate audience, it’s been a total pleasure. I look forward to staying in contact. And yeah, you know what, encourage anybody here that’s, that’s kind of at that stage where their revenue is between 100 to 300,000. And you’re interested in really scaling up, you keep hitting the ceiling.
Like research, these guys reach out to them and see what you can do to potentially put your business on an entirely different growth trajectory. So thanks again, James. But it’s all pleasure. Thanks for your time.
James Becker 25:57
Thank you, I super appreciate it and look forward to eventually meeting you sometime in person.