With the unprecedented growth of eXp Realty across the US and now globally, it’s no surprise that other brokerages would jump on the cloud-based, agent-centric trend that brokerages are moving towards.
One such brokerage that has done just that and has gained some momentum over the past couple of years is Real Broker.
In this article, I’m going to compare how Real Broker stacks up against eXp Realty and which brokerage is the right fit for you, depending on different factors.
As full transparency, I have been with eXp Realty for over 4 years now. However, I have friends that are currently at Real, through which I’ve reached out to help me with this comparison. That said, I’ll keep this article as unbiased as possible and try to stick to just the facts. In the end, I will give my opinion about which model I believe is superior for different agents and why.
Real Brokerage was founded in 2014 by Tamir Poleg and Yuval Niv and is headquartered out of Toronto and New York City. Real is currently in 34 US states. Real is a publicly-traded brokerage. On June 15, 2021, Real moved from the Toronto Stock Exchange to the NASDAQ. Currently Real is home to around 2500 agents, nationwide. Real brokerages market valuation is $430 Million.
eXp Realty was founded in 2009 by Glenn Sanford and is headquartered out of Bellingham Washington. eXp is currently home to over 60,000 agents across all 50 US states and 17 additional countries. eXp Realty, whose parent company eXp World Holdings (EXPI) is also publicly traded on the NASDAQ exchange. EXPI’s market valuation is over $6.4 Billion dollars. eXp World Holdings also owns VIRBELA (which powers eXp World), the SUCCESS brand, Showcase IDX, and Express Offers.
Both eXp Realty and Real are cloud-based brokerages. Neither companies offer agents physical brick-and-mortar offices.
Real offers agents its Real mobile app, a dashboard that displays agents’ transactional and financial data. Additionally, Real agents use Skyslope for their transaction management. Chime CRM is available to agents for $25 per month additional.
eXp Realty has created the eXp Enterprise dashboard. This dashboard is accessible via desktop or mobile. Additionally, agents at eXp Realty use Skyslope for their transaction management. Finally, kvCORE is included for eXp Realty agents at no additional monthly cost.
Both brokerages are not built on the traditional franchise model. Agent growth mainly comes from word-of-mouth marketing through its agents, brokers, and staff.
Commission Split And Fees
Agents at Real brokerage receive an 85/15 Commission Split with a $12,000 cap compared to 80/20 at eXp Realty with a $16,000 cap.
Additionally, once agents are at Real cap, they pay a $225 transaction fee versus $250 at eXp Realty.
Real brokerage agents do not pay separate errors and omissions insurance fees. This fee is covered in the annual fee and cap. At eXp Realty, agents pay $40 per transaction for risk management, which caps at $500 for the year.
There is no monthly fee at Real. However, they do pay a $500 annual broker fee. This fee is automatically deducted from an agent’s first two transactions each year. One side note, if agents at Real wish to have access to Chime CRM, they will pay an additional $25 per month.
At eXp Realty, agents pay $85 per month total. This monthly fee includes access to kvCORE and all other tools, training, and support. So when comparing apples to apples and including a CRM with each company, the annual cost is relatively the same.
Both eXp Realty and Real have a $149 sign-up fee.
Finally, both brokerages allow agents three personal deals per year at no split commission.
Revenue Share Comparison
In 2019, Real began allowing agents to earn Revenue Share. Real brokerage’s payout structure is widely different from eXp Realty. Real’s revenue share is paid on 5-tiers with a 5,4,3,2,1 percentage waterfall. With this revenue share structure, agents you sponsor to Real grant you 5% of their gross commission income. Agents that fall on your second tier (meaning agents whom you’ve sponsored that have sponsored another agent) grant you 4%. So on and so forth down five tiers. I love this simplicity, but I will share a significant pitfall as I see it here shortly.
eXp Realty, on the other hand, has a bit more complex 7-tier structure. Agents you sponsor at eXp Realty grant you 3.5% of their gross commission income. Agents that fall on your second tier give you 4%. From there, the percentage of tiers 3-5 decreases. However, the significant difference between eXp Realty and Real is that at eXp Realty, Tier 6 increases to 2.5%, and Tier 7 increases to 5%.
Tiers 6 and 7 are where I believe the revenue share model of eXp Realty excels. Once you’ve been at eXp Realty long enough and have attracted any agents, you’ll realize your organization begins to form a triangle, with the largest tier of agents being at the bottom, meaning tiers 6 and 7. This concept is relatively common sense. If, on average, every agent brings in two agents to the brokerage, and you bring in 5, then this means that your tiers look like this: 5, 10, 20, 40, 80, 160, 320.
At eXp Realty, you capitalize on those last couple tiers. Tiers 6 and 7 are both your most significant tiers and the ones that pay the highest.
At Real brokerage, the tiers are top loaded and reward less for each tier. To me, this is more like if you wanted to start an independent brokerage and mostly get paid for the agents you bring in. I’ve gone down this brokerage path before and much prefer the structure of eXp Realty’s revenue share.
And finally, both companies require personally sponsored qualified agents to unlock tiers. A personally sponsored qualified agent is an agent that has to earn commissions of over $3,000 at Real and $5,000 at eXp Realty in the previous six months.
eXp Realty requires five personally sponsored qualified agents to unlock tier 2. Real requires 10. I’ve created a chart to show each company’s rev share payouts and qualified agent requirements.
However, one other critical detail to note is that Real brokerage does not pay out any tier two through five revenue share to agents if the tier is not unlocked. Whereas at eXp Realty, even without meeting the personally sponsored qualified agent requirements to unlock that particular tier, eXp Realty still provides a smaller revenue share percentage to its agents.
I know agents at eXp Realty that have sponsored less than five agents but have over 1000 agents in their entire organization and still earn over six figures in passive revenue share annually. At Real brokerage, these agents would make nearly $0 in this exact scenario.
Before I compare the two brokerage stock plans on paper, I want to point out a few things to note.
Current Real management and agents own less than 10% of the company instead of around 70% of eXp is still held by the founders, agents, brokers, and staff. When a company is owned nearly 90% by outside investors, how do you think decisions are made relative to agents?
Additionally, eXp Realty has never taken money from Wall Street, whereas Real brokerage has received money from 3 fairly established institutions, two in Israel and one in New York City.
Currently, EXPI is valued at $6.81B. REAX is valued at $430M. Interestingly, when EXPI was at the exact agent count and revenue as Real is today, EXPI was at a $190M valuation.
Both eXp Realty and Real offer agents stock awards for production and attraction milestones. Real currently offers agents 1000 shares of stock for hitting their annual production cap, whereas eXp Realty offers agents $400 worth of company stock. Additionally, when an agent sponsors an agent into the company, Real awards that agent with 500 shares of stock, whereas eXp Realty offers $400 worth of shares.
One thing to note is that as Real’s agent count increases, the awards decrease over time. A chart shows what the award program offers; however, it doesn’t state the following change.
Agent Equity Program
Both eXp Realty and Real offer agents the opportunity to purchase extra shares of stock at a discount. For example, at Real, agents can buy up to 10% of their commission for Real stock and receive a 25% bonus of these shares if held for one year. Once capped, Real agents can contribute up to 25% of their commission to earn up to 50% additional stock after one year.
eXp Realty, on the other hand, allows agents to contribute 5% of their commission towards receiving actual EXPI stock at a 10% discount. These shares of stock are granted within around a month of purchase and are vested immediately.
ELITE vs. ICON
Both eXp Realty and Real offer top producing agents the ability to earn a large sum of stock through a production milestone called the ELITE agent and ICON agent award programs.
Real’s award is called ELITE agent and grants agents who cap and pay an additional $6,000 in transaction fees (around 27 additional transactions after capping) up to $24,000 in Real stock. $16,000 upon hitting the milestone and another $8,000 after meeting specific cultural requirements (training, mentorship, etc.). Alternatively, agents who close at least $500,000 in gross commission income and ten transactions may also qualify.
eXp Realty’s award is called ICON agent and grants agents who cap and pay an additional $5,000 in transaction fees (which is around 20 additional transactions after capping) up to $16,000 in EXPI stock. $8,000 upon hitting the milestone, $4,000 upon meeting cultural requirements, and $2,000 for attending each of the two in-person company events held annually.
Training and Support
As of their Q2 2021 report, the Real brokerage has around 41 full-time employees. eXp Realty has over 1300 full-time employees, with about 850 in brokerage operations alone.
The increased support staff at eXp Realty impacts everything from onboarding to transaction processing to broker support. I joined eXp Realty when there were 3,800 agents and much less staff, and the support I receive today is vastly improved.
Live training at Real brokerage takes place via Zoom. Whereas, at eXp Realty, live training takes place within eXp World. eXp World is eXp Realty’s virtual campus. The system that powers this technology, VIRBELA, is owned in full by eXp World Holdings.
Having been on thousands of hours of Zoom and hundreds of hours of eXp World, I can personally attest to eXp World being a superior platform for training, support, and collaboration. Zoom fatigue is real. eXp World, on the other hand, seems more personal and interactive.
Both brokerages record their training and put them in a library for later viewing by agents.
Both eXp Realty and Real offer agents the ability to operate teams at a more cost-effective rate. Both brokerages allow team agents to pay in a half cap versus the standard.
This half cap means team agents at eXp will pay $8,000 instead of $16,000. Team agents at Real pay $6,000, instead of $12,000.
Both companies require a minimum split of 25% paid to the team leader for each agent’s transactions.
Culture and Community
Both companies use the Net Promoter Score to measure agent satisfaction. An NPS score above 50 is considered excellent. Real’s fourth-quarter 2020 NPS score was 68 compared to 70 for eXp Realty.
Currently, Real does not offer any in-person events for its agents. However, agents do lead smaller-scale local events. eXp Realty hosts two annual in-person events per year, EXPCON and the Shareholder Summit.
Additionally, multiple large-scale agent-led events take place at eXp Realty. I just got back from The Build Conference in Dallas, TX. There were over 6,000 eXp agents and guests at the event. Tony Robbins was the keynote speaker. There is also an annual event in Cabo in March and will host over a couple of thousand eXp agents.
Outside of in-person events, both companies make use of Workplace by Facebook to communicate and collaborate internally.
Finally, for culture, and this one is a big one for me. eXp Realty agents have sold on average 90% more real estate than Real agents thus far in 2021.
If you take Real’s published production volume through the first two quarters, it equals $1.28B. Divide this amongst the agent count at the end of Q1, which was 1,895 agents. (I use Q1 as that’s about the average for the first two quarters, and it’s more accurate than taking the count at the end of Q2 since it typically takes a couple of months before agents tend to close business with a new broker.) When you do the math, it equals $675,461 in volume per agent.
Compare this to eXp Realty, whose production volume is $64.6B for the first two quarters of 2021. eXp’s agent count at the end of Q1 was 50,333 agents. This translates to an average volume per agent of $1,283,452 which is 90% higher than Real.
For me, I firmly believe eXp Realty is the superior real estate brokerage for three main reasons; sustainability, innovation, and compensation.
The reason I bring up sustainability is that I joined eXp Realty when we had 3800 agents. We were growing extraordinarily quickly, and many of our systems were broken or breaking. It was as if we were building out the train tracks just moments before the train was passing by.
Several issues could have ruined eXp Realty along that path. But because of our leadership and the vision of Glenn Sanford, we were able to push through and become the company we are today.
At this point, eXp Realty’s systems are tested, our staff is in place, and we have a thriving community and culture. On the other hand, Real Brokerage has yet to prove it can create the systems and staff needed to go from a couple of thousand agents to tens of thousands of agents. I also question if Real Broker’s leaders and agents have enough skin in the game to do the things necessary to take the brokerage to the level.
As far as innovation goes, eXp Realty has built and is continually improving new systems, tools, and resources for its agents. eXp Realty owns VIRBELA, SUCCESS, Express Offers, Introlend, Making It Rain Lead Generation, and ShowcaseIDX, to name a few of the companies innovations.
I have not seen enough innovation from Real Broker thus far to make me believe they will be at the forefront of real estate tech into the future.
And lastly, I mention compensation. I firmly believe eXp Realty’s revenue share model is far superior. Again, Real Broker’s revenue share model is highly top-heavy, making it more akin to growing an indie brokerage. You’re mostly rewarded for your direct recruits and less and less for your organization the further it goes down. This structure severely hinders the benefits of having a tiered revenue share compensation structure by which you’re naturally going to have more agents on each subsequent tier.
Also, agents at Real must have ten qualified agents personally sponsored to unlock the second tier of revenue share or earn no compensation whatsoever from additional tiers. At eXp Realty, agents who’ve not unlocked tiers still make revenue share from these tiers, albeit at a smaller percentage.
At eXp Realty, less than 225 agents have sponsored over ten personally sponsored qualified agents out of over 60,000 agents. This reality means that over 99% of agents will likely not open up their 2nd tier or beyond at Real Brokerage. At eXp Realty, these agents would still earn revenue share off their later tiers. Whereas at Real, these same agents would not earn anything beyond the revenue share from the agents they’ve personally sponsored.
And finally, while Real Broker’s stock awards seem enticing, I am concerned with the company’s owners’ and agents’ ownership percentage as a whole. It’s no secret that when the founders and those actively growing the company have a higher ownership percentage, there is more incentive to win. And at eXp Realty, that is 100% the case.
I feel that much of the messaging that has helped Real Broker grow to where it is today is based on the idea that it’s the next eXp and that agents should join now so they can benefit from the early adoption benefits. But if you take a step back and look at what Real Broker has created and its unique value to the real estate industry, I still have many questions.
All that said, I do believe competition is always a great thing, and I have a ton of respect for my friends at Real. Only time will tell which brokerage will genuinely end up on top. I believe both Real and eXp are built upon the foundation that will take real estate brokerage to the next level when compared to the franchise model that is dated and dying. It will be exciting to see what these next few years have in store!
Let me know what you think. Leave a comment below with your thoughts about these two brokerages.