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This is the third installment of Inman’s Talking Talent series on recruiting. For Part One, with Compass’ Rory Golod, click here. For Part Two, click here.
No company is better-known for recruiting, arguably, than eXp Realty.
Since its founding a decade and a half ago, the company has gone from nothing to one of the largest players in the industry. Thanks to generous incentives designed to turn agents into recruiters, it’s headcount ballooned and led to predictions that it would eventually have hundreds of thousands in its ranks.
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Growth has since slowed, but the company nevertheless had 85,249 agents as of its last earnings report — a massive number by any measure.
Wendy Forsythe
Inman recently caught up with Wendy Forsythe, eXp’s chief marketing officer, to talk about how the company is thinking about recruiting and talent at this particular moment. The conversation is part of Inman’s ongoing Talking Talent series, and the high level takeaway is that eXp has something very specific it wants: Teams and top-producers. Forsythe also explained why the company wants to get rid of non-producers, and expressed some optimism about next year.
What follows is a version of that conversation that has been edited for length and clarity.
Inman: Talk to me about what’s going on with recruiting at a high level. What are you thinking about in terms of finding talent right now?
Wendy Forsythe: We’re very much focused on attracting producing agents and teams. So that top tier of the industry. This year we have had a campaign and mantra around “eXp is where the pros go to grow.” That has really been an anchor of our recruiting efforts, especially given the market.
Inman: If eXp is where “pros go to grow” how do you think about newer agents? Let’s say Bob Smith goes out and gets a license and loves the EXP brand. Is EXP the right place for that person?
We get lots of those inquiries, as you can imagine. The ideal outcome for most of those new agents is to join a team. They are more successful by joining a team. So we would try to do sort of that matchmaking.
So we actually track this, and I have this stat for you because I thought you might ask. So 41 percent of new agents that joined us were on teams, and agents on teams are 75 percent more productive.
You say you might do matchmaking. If I go out and get my license and don’t know anybody, do you guys actually hook people up with the right teams?
It happens kind of in a number of different ways. A lot of times new agents may hit our website, and then they’ll get connected directly into our customer care department. A lot of times they will know an eXp agent already. If they’re already connected with somebody, then we’ll work that connection.
If they don’t know anyone, we’ll answer all their questions, find out where they are in a local market and see if we can make some introductions. In that case, we would give them three to five names. So we facilitate introductions.
I’m curious if you’ve seen a lot of recent organic growth, versus you going out and finding folks.
It’s both. Our growth team is proactively going out and having conversations. [CEO Leo Pareja], myself, [eXp World Holdings CEO Glenn Sanford], all of our senior leadership, we‘re active in the industry.
But our agents are still attracting. Part of our business model is the revenue share opportunities. So there’s a definite financial benefit and focus from them doing that same thing.
Would you say that there’s an eXp culture, or is it more defined at the team level?
We definitely have an eXp culture. And then I would say that also our teams, and even our individual agents, have their own culture as well. But that component of collaboration goes across our culture. We have an open calendar of events for every eXp agent across the country that they can go. They can filter by topic, in person or online, recorded or live, and by geography. So that collaborative culture is very much a part of our DNA in the company.
One of the things that people from the outside looking in don’t realize about our company is, at most brokerages, if an agent joins and goes from 10 transactions to 20 transactions, or goes from making $100,000 a year to $200,000, everybody would high five and take that as a win, right? Here at eXp, it’s another level of that. People’s lives are changed and that is because of the revenue created through revenue share, and because of the stocks and being able to be owners in the company. Agents will say, look, I’m able to pay for college for my kids. I was able to pay off my mortgage. We had a medical crisis and we were able to cover that. I was able to retire my spouse.
These are the type of stories I hear daily. That culture is so hard to articulate in words. But when you see somebody’s eyes tear up when they’re telling you the difference this company made in their life, that’s a pretty amazing thing to be a part of.
Is there an average amount that folks are making from RevShare? Do we have a way to quantify that?
I don’t have the breakdown, but being a publicly traded company we report how much revenue share we paid out annually.
We have a story on that. But I guess I was curious how that breaks down. A lot of our readers are agents and they might say like, “hey, if I go to eXp, how much can I expect to make from these other things like revenue share?”
It all depends on how many agents they attract and then what that looks like. So it varies. We have some agents that don’t attract any agents, They’re like, “look, I’m not interested in that.” And that’s fine.
With the ones that do want to build their revenue share, we turn that into a business conversation with them. “Well, how much would you like to make? What are your goals?” For a lot of agents, their initial goal, is they want to get to the point where revenue share is covering all their bills, and then production is their profit. So then we do the math with them and figure out what that business plan looks like.
We’re talking about folks who want to attract others to the company, and it makes me wonder how you guys are thinking right now about head counts. EXp obviously for a long time was seeing stratospheric growth. It has obviously slowed down, as it has across the industry, but I’m curious how you think about it now.
I would say that there has definitely been a pivot. When you get to a size and scale that we’re at, we really look closely at non-producing agents, particularly going into a downturn in the market. So, the vast majority of agents that leave us are agents that have done zero production.
We are much more focused on producing agents and retaining and attracting producing agents than we are at trying to keep our agent count number at a certain amount with those non-producers.
What does it cost to have non-producing agents? Why ask them to leave at all?
There’s definitely a hard cost with the technology that we provide.
There’s also a real consideration, if they haven’t done business, are they prepared when a transaction might fall into their lap? If you needed an operation, would you want a doctor operating on you that hadn’t done an operation in a year, or in two years? I think not.
Particularly with the evolution that the industry has gone through this year, if you’re not an active, professional, invested, skilled Realtor, you could really not serve a potential buyer or seller well.
Let me pivot a little bit. We’re nearing the end of the year, so talk to me about 2025. What will it look like?
From an economic perspective, it’s kind of cautiously optimistic. We’re hearing some of the early forecasts coming out that we could see an improvement in transaction volume next year. I think that anything that would indicate that we’ve kind of hit the bottom of the market, you know beginning to recover or go back up, would be a positive thing.
I think agents are in many ways tired, right? We’ve been through a lot of different market cycles in the last 48 months. But the great agents are prepared and are really investing in their businesses and will continue to do that.
