Glenn Sanford is the founder and CEO of eXp Realty and eXp World Holdings (EXPI). Glenn created eXp Realty in 2009 during the economic downturn.
Here is the podcast:
Prior to founding eXp Realty, Glenn was a Keller Williams team leader. He led multiple teams across the country. When the downturn hit, Glenn's business along with his entire team was greatly impacted.
This led Glenn to scale back and take a hard look at the entire real estate brokerage model. Glenn ultimately decided to create eXp Realty to serve as the "Amazon" of real estate brokerages.
In this post, Glenn Sanford shares his vision and reasons behind disrupting the real estate brokerage model that hadn't been touched in over 100-years.
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All right. Oh, wow, I'm so
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you know, it's this is this journey has been surreal
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when the day that gene
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entered my life, which was late 2014, we first had our first conversations.
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And prior to that, I had been working with the team. And we obviously started the XP back in in 2009. And we literally said back then, that somebody's going to get what we built, and then things are going to really take off because we really were building this sort of foundational element of the company from 2009. But if we kind of go back just a little bit
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you know, I got my real estate license in 2002. And, and, and I was studying looking one and of course prior to that
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I was involved in technology and I had run some small businesses cratered a number of businesses and in fact, when I got into real estate I was $40,000 more in debt than my previous when I started my previous startup. So I was you know, I was literally you know, at that point where I'm not able to pay my credit card bills and you know, driving around in a Ford Focus wagon with a bird in my seat driving around people showing them houses and so I as well I'm one of the people here on stage that the XP is changed the life of it, which is pretty pretty amazing because literally in 2009
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we were pretty much broke as a as anybody who ran a real estate brokerage from 2008 to 2009. That didn't go bankrupt is pretty darn lucky. Because there was like basically about two thirds and and and David gagne and can certainly comment to this back in the day, but we were interviewing, managing broker
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to open up states, at least two thirds of them had file bankruptcy coming out of 2008 2009 and going to 2010 1112. And
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and so it really beat a lot of us up. But we went back obviously, and and we figured out how to get to 2009. And we looked at all the different models that were out there.
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And we said, you know, we want to do something big. And, and our goals at the time. Well, and even in 2012 2013 was 10,000 agents, potentially by 2020. And that was our optimistic goal. Obviously, we blew that away. So thanks. Thanks, gene for recognizing the model.
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And then, of course, Rob, shortly after that, and and obviously so many other people who've who've joined as well and those before, I mean, you've got we've got people that are here literally Suzanne fuquay, who was on stage.
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She was actually our managing broker for buyer tours Realty, which was actually the iteration of the company prior to and and we have so many people who've come through this journey whose lives have been changed with so just, it's just awesome. I'm going to go through a few slides here and you know, this was a I was thinking about coming in
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today and I really this quote, I wrote actually just I was kind of inspired to write it but really the future of the XP realty is dependent on continually iterating supposed to iterate my newer slide says iterated on the value proposition of the individual agent and team and providing them the platform to expand exponentially their business without the limitations of legacy business structures. I think that's a really that's what myself, I know, we've got a number of people from leadership, we've got Jeff Whiteside, or our CFO who joined us and last November, we
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Got Stacey on in here. President brokerage operations we've got Dave canard president of growth, we've got a number of people here who are every day iterating on how to continually add value to agents and brokers and teams. And so so revenue share is it's a value add opportunity that most agents obviously don't have. Obviously, some people focus more exclusively on the the revenue share portion of it. But fundamentally, we're about real estate agents that are out listing and selling homes and then having an opportunity to get off of the treadmill. That, unfortunately, is the reality that most agents in most other situations sort of find themselves in. So, you know, making real estate fun again, really has to do with the fact that when you first got into real estate, it was fun getting those first few deals in, and then you figure out that there's not a way off the hamster wheel. And so as a result in real
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estate the phrase that I used to talk about quite a bit in the early days when I was doing the one on ones and lunch and learns and all the all the things that, you know, Jay kyndra was talking about was real estate agents
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don't retire, they just die, you know, so there's, you know, and it's the end it's literally the only business obviously, and I say this, you know, in with great respect for these individuals as well. But you know, there are people that are still selling real estate using Walker's not because they want to, but because they have to.
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So, so you know, so when we think about what what it was that I recognized for myself, personally, back in my days as an agent, it was that, you know, the first thing they talked about is that in order to actually build something, you need to build a team and and most of us probably have read the Red Book, so we're all familiar with with that. And when we read it, we go Holy smokes, this is the Holy Grail. Let's build a team. I'm gonna be able to retire. We have so much
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book of business and and and it's that's such, it's so hard to do it happens so often it's like getting struck by lightning twice in the same spot on the same day on you subsequent years. It it's, it's pretty difficult to do that and and so I recognize that personally and so the next thing that they say is you need to become a broker and and and own your own brokerage and and so of course having done that, you realize that they told me a second time and I you know so so the idea of actually owning a brokers doesn't make a heck of a lot of sense either in a traditional sense, but you know, back in 2009 I wasn't ready to throw the towel and it would have been easy to do. In fact, it was sort of a almost an up and down kind of thing whether we were going to throw in the towel and go do something else or if we would actually
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Go back to the drawing board and figure out what a real estate brokerage needed to look like to be sustainable for the long haul in good times and bad times, and be attractive to the agents and brokers that work there over the long haul. And that was really what we tried to solve. And it really came down to really, that the technology revolution really, really made that happen.
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You know, 20 years ago, technology didn't allow us to do what we do today, you know, cloud computing and and now we're thinking talking about things like distributed computing on the blockchain you know, social networks to now 3d immersive work environments. So think about the the enterprise and how we're using ESP world and and the way that that we can, we can collaborate and things like workplace these things didn't exist 20 years ago, AI and machine learning. I mean, the reality is, is that we've all been engaged today. At some level if we opened up our smartphone,
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Are smartwatches or what have you, AI and machine learning has taken has had an impact on our lives today. And and that's just going to continually impact what we're doing. We talked about really, my my other slide was 3g to 4g to 5g, once 3g came on the scene, which was round 2006 2007 we finally had high speed internet in our pockets. Now 4g is tremendously better. Yeah, if you ever do a speed test, you get something like 20 megabits a second on your on your smartphone, which is in 2002 or 1999 20 years ago, you were lucky if you had a 28 eight baud modem with all that
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stuff going on. And and and now we've got we've got super fast high speed internet everywhere. And and this really kind of creates this. This this new backdrop, things like Uber and then eventually driverless cars. I mean, the fact is, is that
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All of this stuff changes the landscape that and and also changes the the the future landscape of real estate brokerage and, and pretty much all industries. So, you know, so these these things didn't exist but because they existed and they were starting to exist at some level in 2009, we were able to take advantage of it and build something that is pretty unique. Now, technology of course, is faster than ever before. And it ain't getting slower. And similar to that will never be the small again, technology will never be this slow again. So only get faster, better, cheaper and more efficient. And and something else that I want to talk about about technology. There's a lot of companies right now that are pitching technology, technology, technology, technology, we have the best technology we we invented the cloud for real estate we build a really cool smart sign for real estate and technology. But But the reality is that technology itself can be a red herring.
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You know, obviously there's major well funded, some have recently, you know, raised over a billion dollars at crazy valuations, calling themselves technology companies and building technologies and hiring engineers. But no matter what technology they build today for your real estate business, they will maybe marginally improve your short term business, but won't change your long term outcome. And so that's one of the differences between what we're what we're doing with ESP is really thinking about what's the long term impact of the things that we can build. Now we're building technology we got show me now I'll talk a little bit about I buyer and some of the other technologies that we've got coming down the pipe, we'll talk about some of the partnerships. But But the reality is, is that it's it's how do you put the agent at the forefront of every decision you make? And that's just what we do. And it's reason why we're all here and it's reason why we're growing as fast as we are. It's it's the it's the mindset, and it's in a lot of respects. I think a lot of people I don't know
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I saw Tony but ronica Figaro is probably here somewhere as well. But you know, I saw her at Inman, and she asked, Why do I keep on doing this? Because obviously, it's been really successful. I'm like, I just love doing this. I just it's not about the money. It's not it's not, you know, it, obviously, it's got financials and other things that go along with it. But it's really cool to make an impact. It's really, it's really fun to make an impact.
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So relative to technology, there's not a single cutting edge tech edge technology and real estate that won't be off the shelf technology in the next two years, if it's not already off the shelf technology. So I just want you guys to know that when somebody says, hey, we've got this AI thing, or we've got this, this this great CRM, even if they have the better one today, it won't be for long technology changes so darn fast. And we're going through the same exercise that that every other company is doing on technical
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We're asking the questions. Do we build? Do we buy? Do we license? Do we build? Do we buy? Do we license to hire? Do I hire smart engineers? Do we partner with companies, these are the things that we do. And that's what any company needs to do. And continue to do that, that that will never change. Just imagine if the first technologists quit when they built the wheels.
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You know, that, you know, so that was that was technology back in the day, the wheel was technology. Everything that we think about is technology, anything that enables us to do business faster, better, cheaper, generally speaking, falls in the bucket of technology. And and so even though it sort of is out there, it's it's also something that happens around you every every time you pick another piece of software, another piece of another app to add on your phone, another website to go to you're making technology decisions, and that's just that's part of what you have to do and staying active.
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gel and nimble. Somebody asked earlier in the the nine o'clock session I do with Sam Rodriguez.
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The question was is How do you stay agile and how we stay agile is is by just paying attention. You know, this is you know, we're in the business area somebody wants to come into, into the XP main portion of XP world and they want to find me in in my in my office or walking around there. That's where I spend most of my time. So now, you know, now you can stop me. But, you know, but I but that's where we're having meetings, Jeff Whiteside and I have meeting that's where we meet. That's where Dave canard and Stacey on and so many people on the technology, the accounting team, the transaction team, all the various team, we're all working in the background and to a large extent, you can come in here what we're talking about. Now, don't everybody come at once, but you know, everyone so I'll just stick your head in, you know, here with the conversations that we're having be part of it. If you've got
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Something that's on your mind? Come on in. It's really cool. And, and, and, hopefully, you know, we keep that technology to ourselves for a while, but who knows, in the next two years?
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You know, Brent asked me to sort of make some predictions. And and I know, I know, Tom was talking 200,000 ages, I was just doing some mental math on 10 years from now. And I actually kind of think this might be a little conservative, who knows, it might be a little bit optimistic as well. But everyone in here is probably an optimist. So it probably probably goes both ways. But I really I truly believe that in the next 10 years, we're going to have over 4000
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professionals with XP. We're going to if you think about it, yeah. What's up?
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For 400,000 for 2004 2000? Yeah, I'm gonna have 4000 Yep, we're going to I was, I was, I was still I was I was just thinking about Jay kyndra slide he had 4000 at the bottom of that to that 12 month thing. I'm just going back to 12 months. I'm
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But you know, we're going to be in 30 plus countries, we're going to be vertically integrated across the value chain. So we'll talk I'll talk a little bit about that. And, and numerous complimentary verticals that will also be able to help us in our real estate. But also you guys are all co owners shoulder to shoulder with me gene and every single other person in here in this larger enterprise. And there's so many different things that we're going to be able to do together to build a unique ecosystem that's going to be incredible over the next 10 years.
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That very busy slide.
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Not sure where the other one went, but actually, I know what was on there. You know, we've got the you know, we've been we've just announced some affiliate partnerships. intro and first cloud is is going to be an incredible relationship. And I know Jay Nelson, you went and did sort of a deep dive on it. You were like, first of all, a little skeptical then you then you just
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jumped in, you're going oh my god, this thing is just amazing.
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And, and if you if you know lenders, that that you that you like, you know, like and respect that you would like to do business with, introduce them to what we're doing an internet first thing they're going to do is they're going to first sort of put their hands up and go, I don't want to do this because it's going to cost a little bit of my commission in terms of referral fees into the interline platform. But the second part is they're going to be exposed to all of the enthusiastic entrepreneurial XP agents that can send them business. So their their opportunity will go up dramatically, as opposed to you know, worrying about the two or three deals that that they're thinking about that they might get from you as an agent. as an individual. Now they're opening up their opportunity to actually be in business with many many agents and be exposed to to a larger ecosystem. silverline
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Something we're just the process of launching. This is a title and escrow company that each and every one of us is going to own together, that's going to be in all 50 states, which is going to make things like getting paid faster as an agent. So, so we're going to be able to think about streamlining, the closing process, we're going to be able to think about in one of my moonshots, and I say it's a moonshot because I don't know when we'll be able to do this, but I truly believe will be able to do this at some point. Once we're able to sort of streamline that process. How would you especially those who have grown your, your, your groups of agents all around the world, at that point, hopefully, every time there's a closing, would it be cool if you had your rev share deposit and real time at the moment in closing?
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So, so we're gonna be able to do some really cool things with that. Obviously, we've got some other relationships as well. America's preferred Home Warranty anytime you that you attach a warranty, whether you're working
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With the seller to make the home more marketable, you know, this home is warranteed. And so, buyers are going to naturally be attracted to that property and take a peek at it. Or if you're just working with a buyer, there's a little bit of a financial incentive for you to go do that. So there's some cool things there. And then we've got obviously moving hub. The other one is Express offers. And, and and we're going to talk a little bit more about this tomorrow when I say we, there's a gentleman named Gary McCarthy, and he is the CEO of a company called Wedgwood, which is the largest fix and flip company in the nation. They typically by on the courthouse steps, they're usually the crappiest houses that you could ever find that's what they really like. They like the worst they look the better than they do about 6000 homes a year that the single biggest buyer of product from Home Depot, and and they have agreed to actually be the first anchor buyer on a platform that we've been working on for the last two or three months. And there's a bunch of
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Other buyers of real estate that want to buy
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thousand 2001 company we're talking to wants to buy 10,000 homes, they already own over 50,000 homes across the nation. And this is what they want to want what to own and they'd like to be able to buy homes through us. But then also list homes through the XP agents. So it's going to be a really, really cool opportunity. And
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and then the the other pieces that we're going to be able to plug in other buyers that you know, some of you may be those buyers, you'll be able to plug your buyers in to actually be able to bid on homes on the back end of our buyer platform and anytime one of your buyers buys, you're going to be able to you're going to get a little spiff every time they purchase a home through the platform. So Express offers is coming. It's just in beta. We're in a small small test market right now in in Southern California, I believe
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Nate and Gary can talk about that tomorrow, but it's going to get a lot larger a lot quicker. So with that, you know, I just want to say thank you, for to everyone for, for being part of ESP. It is surreal. One of the cool things of working remote, and I'll just throw this out there
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you're able to actually put your head down and work on the business a lot of times in a different way than when you're in a big office setting. And, and so I work home office, just like pretty much everybody else in the company. And and then every once in a while, I'll see a group of people, you know, I don't know what the number is 1200 plus people that are here with XP cons coming up in two months, I guess less than two months
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here in Las Vegas, and there'll be over 2200 people at the XP con i suspect. Probably everybody here in this room will be there. By
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It's going to be incredible. But, you know, we're impacting so many people's lives. And then I was at a concert the other day and back actually, in early June, and there was over 20 Well, there was about 25,000 people at this concert. And I looked at it and was like, Holy smokes, that's approximately how many people are going to be with the XP by the end of the year. And it's just it's just really crazy and awesome to have impacted that many lives. So
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and, and again, I want to just say, you know, we have so many rock stars that have joined the XP so many people that I looked up to and studied in the mid 2000s. Especially, you know, Jeff Willems, Jake hinder and so many other folks that were really sort of on the big stage, building huge businesses. And and and now so many of these great leaders have come here.
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And and and as Jay said, build one big fire. I never dreamed that was going to take place. And I knew that we're going to get some, some great agents over time, but not this great and and thank you everybody for joining us on the journey so