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We are on a quest to transform the mortgage industry.
We believe there needs to be more transparency, which is one reason why we decided to share a monthly report on what we have learned, what worked and what didn’t, and what’s next in our plans to grow a Billion Dollar Brokerage.
We hope you find a few useful ideas and tidbits to help you in growing your mortgage business.
Welcome to April 2024
Brokerage Stats
Production since August 1, 2021
Volume: $1,497,588,021
Files funded: 3,443
April Production
Volume: $103,688,969
Files funded: 235
April Agent Stats
Rookies: 127(-2)
Pros: 144 (+6)
Total: 271 (+4)
The addition of four net new agents in April doesn’t tell the entire story. For instance, we recruited eight new rookie agents, but have a net loss of two.
Rookies in March: 129 + 8 New Rookies = 137 Agents.
So how did we end up with a net loss of 10 rookie agents?
In Ontario, eight of our rookie agents decided not to renew their licence, which resulted in the following agent count. Mortgage renewals for all Ontario brokers and agents occur in the month of March.
137 Rookie Agents - 8 Non-Renewal Agents = 129 Rookie Agents.
We also had two rookies graduate to Pro status.
129 Rookie Agents - 2 Graduating Agents = 127 Rookie Agents.
Like most things in life, the numbers only tell part of the story.
I also did a three-year review of our production and volume in April. As you can see, we have had a 655% increase in files, and a 577% increase in volume, since Year 1. Considering the overall market, we are pleased with this growth.
How Does Your Brokerage Make Money?
A question I am often asked is, “How does BRX make money?” In fact, I recently got this email from a prospective broker:
I thought I would address this in more detail in this month’s blog post.
A common narrative I have heard from some of our competitors is that we can’t possibly be making money and you should therefore avoid working with us.
This is completely false, and is intended to create fear.
Since launching BRX on August 1, 2021, we have been profitable in 9 of the last 12 quarters. Keep in mind that two of those loss quarters were the first two after we launched.
And when we first launched, we only recruited rookies, so for us to get paid, those rookies had to learn how to do mortgages, go find them, and then fund them.
Once those rookies started funding mortgages, we became profitable.
Another question I am also asked is, “How are you able to be profitable with a business model that pays out 100% commissions and offers stock options and revenue share opportunities?
Well, we took our cue from companies who have gone ahead of us. Exp Realty was a big inspiration for BRX; we looked at their lean and virtual model and thought it could work in the mortgage industry.
There are two other factors that have contributed to our being profitable:
We don’t waste money on dumb stuff.
We have a unique profit centre.
First, we don’t waste money on dumb stuff. For instance, we are a 100% virtual company, meaning no big offices with high rents.
Our rule is, “Will this help our agents make more money or save them time?”
If the answer is no, we don’t do it.
Another example of dumb stuff would be spending thousands of dollars to attend an awards ceremony. While that might feed my ego, it won’t help my agents feed their families.
We also don’t hold large, elaborate events with ice sculptures to signify how well we are doing. Again, that won’t make our agents more money.
This “don’t waste money ethic” is baked into our company culture, and has allowed us to be nimble.
To be fair, we are not perfect—we have made some missteps and wasted money. However, it has never been enough to affect the bottom line.
Second, we have a unique profit centre. I wrote in more detail about this in last month’s post (read it here).
Our unique profit centre is our Rookie Program. Our rookies fund mortgages, and when they do, it’s a win-win—for them and for the company.
We are not perfect, and we are certainly not the right brokerage for everyone. However, we are committed to learning as we grow, and to keeping our focus on helping our agents succeed.
If our agents are successful, I believe that by default the company will also be successful, and we will continue to be profitable.
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