In episode 39 of Wake Up to Wealth, Brandon Brittingham interviews Glenn Sanford, the Founder and CEO of eXp World Holdings, Inc., as he discusses the importance of focusing on agent experience and the innovative strategies that have led to eXp's rapid expansion, both in the U.S. and internationally.
Tune in to discover insights from Glenn that have the potential to change your perspective on real estate and wealth-building.
SOCIAL MEDIA LINKS
Brandon Brittingham
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Glenn Sanford
Instagram: https://www.instagram.com/glenndsanford/
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LinkedIn: https://www.linkedin.com/in/glenndsanford/
WEBSITES
Brandon Brittingham: https://www.brandonsbrain.org/home
eXp World Holdings, Inc.: https://expworldholdings.com/
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Intro/Outro:
This is Wake Up to Wealth, a podcast dedicated to helping you change the way you think about wealth. And now, here's your host, Brandon Brittingham.
Brandon Brittingham:
Hey, what's up everybody? This next segment is brought to you by Greg Herlene and my good friends at Horizon Trust. Greg's a guy that I trust and a real estate partner of mine. Greg's company, Horizon Trust, was founded in 2011, has over a billion dollars in assets. And what they specialize in is helping you get into a self-directed IRA account that you can leverage to do things beyond traditional investments. So you can invest in things like precious metals, real estate, private lending, and so much more. So a lot of people are not aware that you can do this with your retirement account. And these are the guys that I trust. They do a single low annual fee, no hidden fees. They provide exceptional services. I know them and I trust them. And they are a licensed custodian governed by the IRS and the Department of Labor. So they've got the proper compliance and maintenance of your accounts. These are the guys that I trust. These are the guys that I would refer you to. So if you're interested in finding out more of how you can use your IRA to unlock all kinds of different ways for you to invest it, these are the guys that I want you to talk to. So here's where you gotta go to check them out. www.horizontrust.com forward slash Brandon B. So they know you came from me. That's www.horizontrust.com forward slash Brandon B. Hey, what's up everybody? We are back again with another episode of Wake Up to Wealth. And I'm pretty excited because we've got somebody with us that literally has changed real estate forever. Glenn Sanford is joining us on the show today. Thank you, Glenn.
Glenn Sanford:
Oh, thanks Brandon.
Brandon Brittingham:
And I just want to say thank you guys for continually watching and listening. You keep us in the top five in all podcasts and investing in the United States. And a few times we've leaped for all Dave Ramsey and been number one. So we appreciate everybody's support out there. I'm super excited today to have you with us. Obviously I work at eXp, you know, moved over here recently, been overly surprised and overwhelmed at how great this company runs. But I mean, you can't say it any other way. You change real estate forever. Let's go back a little bit. When did you have this idea? When did you say, man, I just got to go about, real estate needs to change. Is there an inflection point you can go back to and say, this is when I got the idea?
Glenn Sanford:
Yeah. So there really was three inflection points that I can really think of. One was even getting into real estate. First, I had the belief that nobody made any money the first few years in real estate. So I actually ended up joining a team, but I ended up getting a guarantee of three grand a month. So that was actually how I got into real estate. So there was a kind of a belief that it wasn't really, didn't have a lot of stability. Then I became, you know, Rookie of the Year. I ended up, you know, hitting a bunch of milestones in my fourth full year in the business. I was in the top 50 nationally with Keller running a big team. But, you know, in talking to various team leaders at the time, what I recognized is that very, very few teams, if any, were set up in such a way where the team leader could fundamentally retire. So the next thing was to start a brokerage. So I was just looking at the career track personally. So that was 2007. So I went independent, ran a teamerage. But one thing that I noted in early 2007 as I went to was a KW family reunion and they had all the top owners come up on stage and the number one market center in the country that year was Boise, Idaho. And the owner profit, and keep in mind, there's like five, 600 franchise offices. The owner profit for that office, the best one in the country was 800,000. I'm like, gone. Okay. I mean, not that 800,000 is bad income, but to think about that's the best in the whole system. Like I'm going, this is just like, you do not make money even as a broker owner. And so that's when I came up with the phrase that the reason why they call broker owners, broker owners is because they're broker as an owner. I said that today, by the way. And so I recognize this, but I also ran a very high production real estate team. So I'm sure a lot of people watching are, you'll also run real estate teams. And teams generally, they've got way better since I was running teams. But back then, you typically didn't see many teams that got above about 12 to 15 agents. They get there and then there'd be a defection of a group saying, lead generation must be way easier than I think it is. I'm gonna go start my own team. And of course they'd all crash and burn. But I ended up with six teams, all that would sort of run up against this. And I'm like, this revolving door of agents doesn't make sense. And so I did say, if we ever built something, I would build it so that agents would have an incentive to continue to build an income for me as a team leader, even after they graduated off the team. So that was kind of in the mix. That was the early idea. Yeah. Yeah. But, you know, a lot of times you can't put early ideas into motion until there's an opportunity. And the opportunity was the crash. Right. So the crash changed. Oh, wait. Yeah. So I had four physical offices, we were getting ready to open a couple more, and then the crash happened. And we quickly had to close three of them. Fortunately, we had good terms on our leases because we were expecting to actually add office space, not reduce, but we kept our leases really short. So we got out of all the leases. And at that point, I look at my cell phone, in 2008, you finally had 3G, which was actually fairly fast back then. We had cable internet in every home in America. And for the prior five years, six years in the industry, all these real estate gurus talked about the virtual real estate brokerage and the agents would be entirely mobile, but nobody built that platform. I loved Keller Williams in that I loved the promise of profit share, meaning they have a seven level profit share system. We have a seven level revenue share system. But the problem was, is the bricks and mortar eats up all the profit. So there was no profit really being shared in the system. But I said, if we can get rid of the physical bricks and mortar, we can go entirely mobile. We can give agents a better split and cap. we can share a portion of that savings back with agents and brokers, the leadership. I really think that fundamentally, the reason why we continue to win is because we're incenting 1099 independent contractors to take on the leadership and recruiting component that you can't scale through W-2 employment very well. And that was the premise that I think this will work. I think it would work for me. I got rid of the teams because I didn't want to be competing. So we had lots of great SEO generating tens of thousands of leads a year. But for me, it's like this was kind of the next iteration of what I thought it was going to what was gonna work, and knock on wood, it was a total science experiment, but it worked.
Brandon Brittingham:
Yeah, that's fascinating, but there was, you had to go through a period of beta, right? But there had to be a time in that where you were doing this, where you were kind of like, I don't know if this is gonna work, right? Like maybe your back got put against the wall, you're having some problems, like, right? Because it was kind of, it took some time before it caught on, right or wrong. Hey, let me tell you about my good friend Jeff Hyatt over at MSC Consultants, and check out his episode if you've missed it. With today's volatile interest rate environment, real estate investors are looking for every advantage legally available. More and more are realizing that accelerating depreciation allows them to free up cash flow, enabling them to acquire their next property sooner. MSC's approach to cost segs is the answer. If you've got properties out there you haven't done cost segs on, you're paying too much in taxes. MSC's approach to cost segs is the answer. Visit them at www.costsegs.com. That's www.costsegs.com and ask for my good friend, Jeff Hyatt.
Glenn Sanford:
I'm an optimist, so I always believe in whatever I'm doing. So, you know, I'm sometimes to a fault. Yeah. And you don't know if you're right or wrong until you crash and burn. So for me, I knew it had all the ingredients for people like me. And I call myself a focus group of one to get excited about it. My back against the wall, like we burnt the boats. I told the team, if we're gonna ask our agents to work 100% remote, we have to work 100% remote. And I went to the team late September. We launched the XPR. And when was this? This was 2009. So late September, I said, you guys are taking your computers home with you. We're going to work entirely remote. this is gonna work or it's not gonna work. And if it doesn't work, we're all looking for work. So that was my motivational speech to the team. And everybody showed up in our virtual office as avatars on October 6th, and we started just knocking it out. And we never had a month where we had fewer agents than we had the month before. We had two months where we had exactly the same number of agents, but we grew. And I'd done my projections, and I knew that with the model that we had at that point in time, if we get to 300 agents, then we could be sustainable on that model. And so we worked at it, added agents every month, and a few years later, we're getting up into really didn't even pass 300 agents till like 2014, 2013. So it took you from 2009 to 14 to get to- Yeah, 13 or 14, yeah.
Brandon Brittingham:
So it was a bit of a
Glenn Sanford:
grind. And I had other small businesses around it that, one of them, we were probably the number one SEO team in the country. So we started to market SEO services to other agents around the country. We didn't want to because we were really good at it. But that's how we sell that and then we funnel the money back in. Yeah, you got another profit center. Yeah. And so that we could get to some sort of scale. And then eventually the infrastructure got, enough infrastructure got in place that then we started to attract some people who saw what this infrastructure meant. for their abilities to come and join us on the journey. And then, you know, 2015 was the first, you know, we went from 400 to 800 and 800 to 2,400, 2,400 to, you know, 13 or 16,000. So, I mean, we did this like super, super rocket ship. So the, you went 2,400 to how many? Like something like, well, 8,000. Yeah, 8,000. And that was in 12 months? That was in 12 months. So some stuff broke, I would imagine? Oh yeah, everything was broke. Anytime you double something in size every six to nine months, all the systems that used to work don't work anymore. So we were continually having to either break it early, because we knew it would break, or it broke and we needed to fix it. So it was a lot of duct tape and bailing wire.
Brandon Brittingham:
Looking back, did you ever think it would be as big as it is?
Glenn Sanford:
I don't think I, I didn't know what the number would be, because in my mind, at that point, we, as a single brokerage, no single brokerage had grown over about 40 or 50,000 agents, and almost all of those were done through acquisition. That was NRT, Berkshire Hathaway Home Services, and then you had some organic growth, HomeSmart, and a couple others that got up into the 10,000 plus range. So for me, I was thinking that anything over 10,000 was a home run. And so that was a number I felt good about. But as we approached it fairly quickly, then in 2020, Actually, 2019, I think we went over, but by the time we got there, we were on this hockey stick, so we knew we were going way past it. But 10,000 was, for me, a number that obviously still was a game changer in terms of just size.
Brandon Brittingham:
Yeah. Obviously you probably learned, you know, how many lessons, but if you could go back to, I mean, I know you can, you could speak for hours on this, but what do you think is one of the biggest lessons you learned that was either in a failure or a pivot towards your success where you were like, I can tie something back to this decision. I either made good or bad.
Glenn Sanford:
Yeah, so I started eXp when I was 42. And I only mention that because I think by the time you're 42, if you've been a diligent entrepreneur, you've probably made most of the mistakes before you got there. So by the time I got to 42, I'd figured out motivations, P&Ls. I'd figured out a lot of the stuff that would need to be in a successful startup. And it wasn't really a startup because it was really seven years in the making from the time I got in the business until then. But some of the decisions that I'd made earlier in my career was if you have a vision don't get distracted by smarter people. Oh, that's good. Like there's a lot of people who have quote unquote experience and they're experts. Like if they've never done what you want to do, there's no way they can advise you really well.
Brandon Brittingham:
Yeah, that was going to be my question. So is that in the sense of you came to people with this idea and you had the vision. Oh, that's not going to work.
Glenn Sanford:
Yeah, like countless experts told me, this won't work. It can't be done. Nobody's ever done it. And I hired a number of experts, really, I hired some experts really starting in around 2015, 16. I figured out that I really wanted generalists, not expert. Now, there's certain, you want some domain expertise, but you don't want like, for me, having somebody who'd come from traditional large brokerage, like this just is so outside of their- They didn't understand.
Brandon Brittingham:
Yeah, they didn't get it.
Glenn Sanford:
Yeah, they didn't get it. So we churned through a bunch of expert and then realized that we really needed generalists that were willing to be creative and learn on the go.
Brandon Brittingham:
Yeah, yeah. That's, man, that is, that's a piece of gold right there. I've never heard someone frame that the way you did. I'm a believer of a lot of times, the biggest strides I've made in business is when people told me it was a bad idea. Right, because they were an expert. Right, yeah. If you were to think about something, what do you think is the biggest mistake you made in growing this company?
Glenn Sanford:
Well, some of it was hiring experts. So certainly that ended up causing some challenges. I wouldn't say there's been a lot of major mistakes. But we've had definitely growing pains, like we got early on in our history, we ended up getting somebody pulled the authority scam on our accounting team, and so we wired money to some scammer that we never got back. And there may have been some agents that were with us that we kept on too long because they caused us reputational damage and that type of thing. So they're just general stuff. But I think for the most part, there wasn't any major, major mistake. is stressful as hell building something to this scale. The one thing I can tell you is that if you're doing something really radically different and people start to recognize that it's going to grow, there's a ton of people who will try to strip parts of it away from you. and try to take credit for it. Yeah. And even though they had nothing to do with it.
Brandon Brittingham:
Yeah. No, 100%. Do you think that your, do you think your answer to that is partly because number one, how you, how you, your outlook of being an optimist and then number two of this whole thing was a beta until it wasn't? Yeah, well, we still talk about this still being in beta.
Glenn Sanford:
Because I think the idea is, how do you continue to be a day one company? The moment that you're out of beta and your product is fixed, your product starts to get stale. So for me, I'm still every day playing with a new tool, technology, idea, brainstorm, and I'm a huge mind mapper. So I mind map like, Now, I would say because of AI, I'm not mind mapping as much because AI is now my strategic business partner. But being able to take ideas and mix them together in unique ways that haven't been done before. At some level, everything's been solved by somebody else, but usually not in the thing you're trying to do. But if you can look at a different industry, the other day I was just reading an article in which they asked this to a business school student, so I don't know the exact, but what are the slaughterhouses in Chicago? What is quick-drying gloss? have to do and what is the Singer sewing company and and how they sold their sewing machines. What do they have in common? It was the Model T car. It was the slaughterhouse to factory line. It was the quick drying black lacquer on cars. So basically the idea that you can have any color you want as long as it's in black. And then it was the franchise system to sell the automobiles. And that was what Ford was. They took three different things that were being done and combined it. And that's what created his massive success. So for us, it's like, hey, the cloud's coming. So it's not like anybody didn't know it was coming. So everybody, and Keller had already sort of proven up that profit share is a driver of attraction for agents. People want to be included in, even if it's the illusion of profit, they like the idea of being involved. And then where does all the various other tech pieces that can kind of get in the mix there. And then nobody had ever taken the approach, like if you think about it as a team leader, you are doing all the things that a broker owner does. You're recruiting, you're training, you're supporting, you're doing compliance, the whole nine yards. So why not turn all those things over to the people who are probably better at it than the broker owner? And nobody had done that before either. So those are You bring those three things together, and all of a sudden, you've got this new model. And now, every new model that's come out in the last five years has been basically a copy of eXp.
Brandon Brittingham:
Yeah. I want to ask you two more questions. And for those of you that listen to this, you know I always ask the same question last, but I'm going to change it today because I think it's important. So you said your vision, and obviously visions change, but did EXPS exist today? Maybe not by numbers of scale, but does it look like what your original vision was?
Glenn Sanford:
Generally speaking, because the thing we were trying to solve for was the revolving door for agents for the teams, recognizing that agents are entrepreneurs and are attracted to ways to leverage their abilities through sort of a network marketing style comp plan of attracting other agents, other like-minded folks. So I think we, I think that all, like, I think most of it is actually very aligned with the original vision. Yeah.
Brandon Brittingham:
Hey everybody, let me tell you about my good friend, Carson Harleen. The Wake Up To Wealth podcast is proud to be sponsored by Carson. Carson helped me build my family banking system. What I've seen Carson do for people, it gives them back their peace of mind. If you want to get your mind and your money right, email my good friend Carson at carson at themoneymultiplier.com to learn how you can become your own bank today, like I have. So, I mean, there's, I mean, there's no, you can't debate this, right? Like it's facts, it's data. So you change real estate forever, right? Like, I mean, you are the, it's cemented, it's your, you've cemented a legacy. Think about how many people and like you've made wealthy, right? Agents, right? That never would have had this opportunity. Like, do you, have you actually taken time to sit in the like part of your legacy as you've changed real estate in the United States forever?
Glenn Sanford:
Yes, I have. I work home office like everybody else. And I think that, The one significant benefit to that is it keeps me pretty humble relative to those who are sort of surrounded by a whole bunch of people in an ivory tower somewhere telling them they're, you know, whatever. And so for me, I just, I go to work every day like everybody else. Like it's not, there's not, like my day really probably doesn't look that different than your day. Now you might have an office or something, but the work's still the same. But then I will hear people and they'll come up to me and they'll tell me those stories of, you know, somebody got in a car accident. Somebody had this happen. They were able to put their kids through college. They were able to do some major things. I mean, obviously we've got people who are making money that's just crazy, crazy large, that even for them- From RepShare. Yeah, from RepShare. To be clear, yeah. Yeah, that even they're blown away by it, and they were successful in some other thing. Already, yeah. But for me, it is the agent who normally would not have had the opportunity to scale a business because they aren't wired to build a business. And yet they need the benefits of a business in order to create legacy for their family.
Brandon Brittingham:
Yeah. And correct me if I'm wrong on this, but just being here for the short time that I've had and the experience I've had, I feel like the lens that you've looked at it through the entire time is how do we improve the life of the agent?
Glenn Sanford:
It is, yeah. I get some heat from different people, even board members, quite frankly, that think I don't pay attention to the street, Wall Street. We've never taken money from Wall Street. We've never raised money through an IPO or anything else. They can buy our stock and you can look at the cap table. There's a lot of institutions now that own eXp stock, but they did it by choice. I didn't go pitch them to go buy our stock so that we could fund some initiative inside the company. But for me, the nice thing about it is I'm not One company right now is rumored to be selling a big portion of their company to private equity. And I won't mention it, it'll come out in the news, but they're supposed to be agent centric. And when private equity owns you, you know they're going to change what your company does. You look at other companies and the people running it own such a small percentage and they've never sold real estate and they're supposed to be building an agent-centric company. And I don't know how they do that when they've raised $15 million from this person and $25 million from this person and they've got some of those people on their board and they're gonna be sitting there focused on profit maximization rather than agent experience. And the best way to kill long-term profitability is not take care of your most important asset, which is your customer.
Brandon Brittingham:
Yeah, I cheated. I said I was only going to ask you one more question, but I'm fascinated by listening to you. But this will be the last one. What gets you excited now? What gets you excited?
Glenn Sanford:
So right now, I'm working on international. And so we're adding three, four, five countries this year. We've announced three. We'll probably have another couple that we'll announce pretty soon. I'm excited about changing the lives of agents who even have it worse than agents in North America. US and Canada, if you're an agent here- We're blessed.
Brandon Brittingham:
Compared to the rest of the world, they don't understand.
Glenn Sanford:
Oh yeah.
Brandon Brittingham:
Yeah, I get it.
Glenn Sanford:
Yeah. And so really focusing on, taking back control of their ability to market properties internationally, giving them a platform where they can actually build long-term retirement income and residuals and equity ownership. Like we're just, we grew this last year by 72% in a lot, Q4 over Q4 internationally. And that's so we've got this acceleration that's starting to kick in internationally. And so we're just on the front end of the hockey stick that we had in the US and Canada. And we're getting ready to do that internationally. So I'm excited. It's a lot of work. but it's also what I enjoy doing. Yeah, I've got a few hobbies outside of work-related activities, but I enjoy building, impacting people's lives, being of service, and that's just kind of what I do.
Brandon Brittingham:
Well, thank you so much. Man, I'm probably going to have to go home and listen to this again, because I'm listening to it in real time, but I want to absorb it. I mean, there is no question. It's not debatable. I mean, you've changed real estate forever. And I thank you for that. And I know there's a bunch of people in my audience that will thank you for that. And I really appreciate you being on the show today. Thank you.
Glenn Sanford:
Awesome. Thanks, Brandon. Appreciate it.
Brandon Brittingham:
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Intro/Outro:
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