Nathan Daniel: 0:03
Welcome back to another episode of the Broker-to-Broker Real estate Podcast. I'm excited that you're here because today, we're going to be talking about a topic on how to leverage your brokerage to create additional revenue streams. And I've got somebody all the way from Atlanta, Georgia with first class real estate, Charles Benton. That's going to be joining us. So stick around as we queue up the music and get this thing going. Welcome to the Broker-to-Broker Real Estate Podcast, where we have real raw conversations with industry leaders, finding out how to connect, support, lead, and ultimately make an impact and drive results in the lives of your agents. I'm your host, Nathan Daniel, and welcome to the show. All right. Welcome to the show. Charles Benton with

Charles Benton: 0:44
I appreciate it. Thanks for having me. First Class Real estate. Man, welcome.

Nathan Daniel: 0:51
Yeah, I'm excited that you're here. So to kick everything off, so everybody knows who you are. Tell us a little bit about yourself.

Charles Benton: 0:58
Yeah, sure. Like you mentioned, I'm from Atlanta, Georgia. For us real estate, I've been in the industry for 15 years, kind of started in 2006. I like to joke around because I was in the Navy for six years on a submarine and got the submarine walked off. And a month later, I was showing houses so it just stuck. So but been here, been in Dallas for a while do real estate in Atlanta. And over the past couple of years, we've expanded in first class as a franchise, so I've kind of got into the franchising side of it, but it's been a run in real estate is always always fine.

Nathan Daniel: 1:33
Yeah, absolutely is. And, you know, we were having a little bit of a conversation beforehand. And I love that, like the fact that you went from sub, and I just wrote this down from a submarine to selling in less than a month.

Charles Benton: 1:48
Yeah. Thank you

Nathan Daniel: 1:50
So first off, thank you for your service, I appreciate that. I know that's a, I'm sure a very stressful position to be in a submarine. But thank you for your service. Great. Appreciate that.

Charles Benton: 2:01
Appreciate it.

Nathan Daniel: 2:01
So let's jump into the topic of the day. And let's talk about how to leverage your brokerage and create additional revenue streams.

Charles Benton: 2:09
Yeah, absolutely. And this is something over the past year, year and a half have really started focusing on as a Roma brokerage to more agent count transaction as an agent. When I had a team, I was always doing marketing agreements with lenders title company, and I just noticed they were always more benefiting me, you know, a buyer's agent stuff really never got to reap the rewards of it. And as I was growing agent counting, kind of got out of production, that still had those market agreements in place. And I was like, "Hey, you know, how cool would it be, if I can give even a brand new agent, a marketing agreement to go in use that for", marketing, just overall costs of it, but my feeding business. So that's when I kind of started getting into the JVs of the mortgage and title to be able to do that. At first, I was kind of selling shares to agents, and then after that, this still isn't really helping them as much as giving them marketing money. So I've kind of transitioned into that and it's a great recruiting tool, and did MBU, it really does help the agents and it drives production to both revenue streams. So I've kind of been big on opening up and all these franchises, these additional revenue streams for brokers and to really profit and also make the agents profit, you know, kind of a win-win.

Nathan Daniel: 3:31
Alright, so let's break this down. Let's, first and foremost, you've established your brokerage. So if anybody listening right now is at that position, you're looking to add additional revenue. We're talking about how now you're you're focused on mortgage and title as primarily those two ancillary businesses right now. Right?

Charles Benton: 3:51
Yep. Right.

Nathan Daniel: 3:52
Okay. So, take me to the very beginning steps, if I'm somebody who's like, "I kind of want to be interested in this", how are you doing this differently? Because you said you're, you're working it to get your agents profit.

Charles Benton: 4:03
Exactly. So again, what kind of went back to the whole market agreement where that really propelled my business once I was able to give a lender enough transactions where it was, but it wasn't easy to get these market agreements. They're stingy, and, you know, they don't want to get into these contracts with you. And as I was doing that, and we were growing, and I got to production, those markers didn't make as much sense. So then I started looking around "Okay, how can I leverage our agents transactions to grow into a whole another pretty much business", is what they are and making profit and that's when I started to look around and, got into the JV industry in I went to the lenders, and I was getting market agreements with them. It was no sorry, we're not doing that. You got to be doing X amount, so it was just as difficult so, I was like, Okay, "Well, what about going to the mortgage broker side of it". And yes, it turned, it turns into a little bit more of a P&L, and you really got to run it like a true business. But it was a lot easier than what I thought, especially if you had the transaction accountant, if a broker is still producing is definitely profitable, but even when you get out of production by giving these these market agreements, so for example, if an agent does two deals with our mortgage, after that, they will continue to get monthly marketing agreements to use for leads, listings, maybe photography, whatever it is. And what that has made and really drives him to push to that to continue to get that income.

Nathan Daniel: 5:42
Okay, so an agent closes and that I'm going to go back here in a second. But an agent closes those two deals, now they have some revenue coming back from the mortgage company to provide whatever kind of marketing services that they choose, is that what you're saying?

Charles Benton: 5:55
Right. It is continuous, not just "Hey, great

Nathan Daniel: 5:55
Yeah. Well, and that was okay. So you mentioned job for those deals", it is an ongoing to continue that partnership. It's not just like a one and done which Respa laws don't really allow that anyway. But that's how you can do the best. Yeah. Very careful, you can't do it. Same with Tyler, we can't do pay per tra saction. So that's how we'll set it up with them. And it's jus an ongoing, and as they gro , the mortgage and title wil grow with them. So it's rea ly up to you how much they wan to utilize that. Because if you re a new agent, you're doing two deals a month, you're not goi g to be able to go get a mar et agreement. No lender, the 're not gonna mess with you. In his way, we do. It's retention wise is out of control, too. as I'm gonna say, Respa, right, like, immediately pops in my head. Because I know, several years ago, like that was the thing like joint ventures and marketing agreements, and all these things, like they were under a microscope. Can we talk a little bit about that? And, how you've worked through that?

Charles Benton: 7:01
Yeah, absolutely. You know, being that it is ownership of the brokerage is obviously disclosed the buyer sellers, everybody. But then when it comes to the agent side of it, that market agreement has to be for at least three months. So if they do a bill and signed it, we set them up on it, you know, they'll have that for months. If it goes, it just renews. And then if they leave or whatever, we still have to honor it. As far as that goes unless we give it 30-day it does. So there are guidelines to this, it's not that we created, like how the the marketing agreement is, all we really did is we created the mortgage company that can provide the marketing agreements now that the brokerage owns, it can trickle it down.

Nathan Daniel: 7:44
Alright, so then the brokerage is the one actually starting the mortgage company?

Charles Benton: 7:47
Well, there's no, I am. I'll start it. It's really I call this kind of the hedgehog effect. I don't know, if you guys read the book, "Good to Great". The brokerage feeds the mortgage title, the agent count. So the brokerage is kind of a standalone, but these other businesses will feed off of it. So the mortgage is a completely different entity. You know, that's why you could sell shares, if you wanted to, you can do whatever you want with it. But it does, you know, it needs the agents in the transactions to really make that steam engine go. So they are separate complete entities.

Nathan Daniel: 8:25
Alright, so what I've just heard you say was the hub has to be in place, which is the brokerage and it's got to be producing, it's got to get transactions. And at a certain point, when did you go, "Okay, we're doing enough transactions where it makes sense to open the mortgage company"

Charles Benton: 8:40
And that's a great question. And it took me a while to kind of figure that outmyself is, once you kind of you can kind of max out on market agreements. You know, one lender might only go up to 10 grand, let's say. And so by having that if you have an 80-agent brokerage, sure that's great. But the broker just gets to profit all that from from the agents. The second thing is, once I kind of stepped out of production, and couldn't really see the whole business in a whole, that's when I knew. So I would say once we got to about 60 agents, and we were doing probably about 30 to 40 transactions a month, that it started to make sense. And you kind of maxed out on those marketing agreements.

Nathan Daniel: 9:24
Okay. So, while we're sticking on mortgage, if I'm a broker, and I'm like, "Well, how do I even begin with this?" Where would I start? Like, what's the first step that I would take to begin the process of becoming a mortgage company?

Charles Benton: 9:38
Yeah, it is tough. You got to do some research to see what kind of model because there's two different types of JVs, really. There's more of a hands off one, where you'll partner let's say a movement, mortgage, caliber, something like the bigger name, and they'll handle everything. Then you'll have like a more of a brokerage setup where you'll go and get the wholesale counts, you might have six or seven lenders, you can push deals to whatnot, then you'll set that up as just like a regular mortgage brokerage, you just got to LO, ot the licensing, and do it hat way. So it really depends n how much a broker wants to be nvolved. Obviously, the more ou're involved with that sound ore lucrative it is, then going nd kind of having more of a urnkey JV, is what I call it. But it just depends on where that broker is, and how much th y want to put into it. I've al ays enjoyed mortgage, eve when trig and all that came ut, you know, way back, then I w uldn't get my mortgage license j st to learn at all like this, hese laws are crazy. So I've alw ys had a thing for mortgage and I've done both different typ s of JVs. And it really got o see the ins and outs of the . And it's just kind of reall up to that broker. But to get tarted, you gotta find the companies that do it. And t ere's quite a few. It's j st how they're set up.

Nathan Daniel: 11:00
Okay so research, do your research is what I'm hearing you say research, the different companies that are out there that you could potentially go into business with. And then as far as, key staff, like if I were to start and like, "Okay, I've got the model figured this out." Like, if you had to do it again, who would be the first couple of hires that you would make?

Charles Benton: 11:18
See, and this is what's a misconception is, you know, mortgage or thing about mortgage company, "Oh, my gosh, you got to processors under all this", think about when you start a brokerage, and it's just you, right? Okay, you go get an admin, right, there may be some buyer's agents, you build that up, that's the same with it. You know, first what we did is, we went and found a loan officer that we fit in well with our agents and did that, then we built it up, then we get a loan officer assistant, better. So profit, then once you hit a certain volume, then you get an in house processor, which would be like a transaction coordinator, let's say. It literally runs the exact same model as a brokerage. So when I was saying that brokerage is your main piece, because that's how you can run both of those, that exact same model, you don't have to have a certain way to do it, you know, because LOs can process around loans, you want to go and really hire a transaction coordinator yet, you can wait. And they only said send it to the lender. They're doing underwriting, here's clearing up conditions and stuff. So a lot of people are like, man, I didn't even know where to begin. Why, did it like my brokerage? Really? I just ran it the same way when I started.

Nathan Daniel: 12:27
Awesome. Okay. And then second piece is putting that marketing agreement in place between the agents that are doing the transactions, doing your research, figuring out what that model is going to look like. And I'm sure you had an attorney draft something up for that, correct? Yeah. Okay. All right. Very good. Any any other advice or anything like that, that you would share with anybody that's wanting to take this adventure on the mortgage side?

Charles Benton: 12:50
Yeah, it's really, you gotta be all in. That's the only thing with it, if you just had to do this, it's not like a mortgage agreement where you could, "Alright. Lender, I'm done with you guys. Y'all made me mad, I'm out. And you really have to make sure that your agents are happy. Because if they're not happy with it, hope your whole concept can go down in flames. Because this is like a true business. You know, you got clients that get ticked off your brokerage, you know, bad reviews, what not. So it's like that, but if someone's really wanting to get into this, and it's a big picture, right, you got to really want to grow your brokerage. So you know, those fundamentals, and I know we were talking before you were like, Hey, what are four things that you would tell an agent and I said. Well, I tell them this monthly, pay attention to how many recruits you bring it on your agent count how many new listings you're bringing in, you know, when I say that, you the brokers is bringing in how to enter contracts, how many closings? If you watch those four key matrix, the mortgage will make sense. You're going to be able to project that and then kind of know how many transactions you're putting in there and in the profit is is way more than marketing agreements can ever be in so that's what you got to consider you're running another business is it and just like, Cool, let's try this.

Nathan Daniel: 14:09
Yeah. Alright. So do your research. You know, explore the different models. If you're going to be doing marketing agreements, get with an attorney, make sure the draft all that stuff up, and then duplicate your your process that you started with your brokerage. Right. And so now you're opening the mortgage brokerage and starting a new team, basically.

Charles Benton: 14:26
Yeah.

Nathan Daniel: 14:27
Alright. So if you're just joining us, and you're just tuning in, we're talking to Charles Benton with first class real estate, and we're talking about how to leverage your brokerage to create additional revenue streams. And specifically, we just finished talking about mortgage. And so I want to transition a little bit because you're also moving into title as well. And now you're in title in two different states. Right?

Charles Benton: 14:50
Yeah.

Nathan Daniel: 14:50
Okay. And you've got now multiple locations, one state is attorney driven, right, and the other state is not. Right, so you're kind of both arenas.

Charles Benton: 15:00
It's way more difficult with the attorney states. Obviously, you probably know that too. But it's very similar to the concept. It's just way more regulated, as far as you know, professionally going state across state lines with stuff. But when you do kind of more of a JV with the title, though, there's so much more on the back side, that partnership, they're going to do so much more, you know, where, in essence, yours bring the business and they're almost doing everything. So it's a little bit different than the mortgage side of it. But, you know, the key did as well, is really driving that production with those agents. And then we still utilize the same concept, though, with the marketing agreements on that. But you can be just a little bit more flexible. Because you're not having to do as much work. I mean, a lot of brokerages will go do a title JV first, because it's easier. You don't do as much work. But that's just your kind of the start of it.

Nathan Daniel: 16:04
Well, and that's what I was gonna ask. I was like, if you had to choose between the two, which one would would you go for first, would it be title, would it be mortgage?

Charles Benton: 16:12
You know, if I was still in production, probably title because it's a lot easier to do that. Now, it's not anywhere close as lucrative. So if you're transitioning out of production, then you might want to look more towards the mortages because you'll have time to build it up. Because like what, we recruit LOs like crazy, like, just this week, I've hired three. So that's kind of the same concept with the brokerage, we're hiring every month, you know, we're bringing in same with LOs. We want to grow that so they can go out and get business outside of us, you know, so now I leveraged off the brokerage now I'm leveraging the mortgage company to go get other agents from other companies then to bring over so it's also attracting agents from that.

Nathan Daniel: 17:00
Okay, this is this brought up another thought, right, just out of the blue here. Alright, so you've started building this mortgage company out? I know, we're going back to mortgage here, but it's an important question, I feel. So those loan officers, they're going out there, and now they're doing business outside of your original organization? Are they still offering the same marketing agreements? Or is that an exclusive thing for people inside your world?

Charles Benton: 17:24
No, we will, it's going to be a little bit different, though. Probably a little bit more transaction before we'll do that. But one thing unique how we kind of got this going is, we would generate leads for the LO to go pass out to another agent, another company? Hey, I got some of these leads. Are you interested in taking them? Well, yeah, I'll take our great boom, they build that relationship. So as we keep giving, they keep getting the leads, the market improvement doesn't come up as much that kind of facilitates it. Now if they start doing, you know, heavy hitter, yeah, we'll go and do that. But we try to keep it as much because you can get burned, going with someone outside of it. Because you have to do a contract, you can't just pay per transaction. So it's a risk. But we found with that utilizing different lead sources, that then the agents passing it out. It's been huge, because I was thinking back in the day, I was like, "Dang, I wish the law school was giving me leads" like that. I mean, so that's when we were like, well, what if we set up that way? So it's really done well. And like I said, it's also spins off us recruiting them to come to first class. Saying, "Hey, look, we can get you market group right now, and leads or whatever". Whatever the case may be, you know, kind of use it to leverage but that was the whole process of it is kind of like when you recruit an agent, if you provide them leads, you also teach them to go get their own business. Exact same concept with these LOs. They'll come on, we'll teach them how to go out and attack other agents.

Nathan Daniel: 18:59
Well, okay, so a little more with title. Let's talk about the setup. As far as that process. Let's move back there. Tell us about that process. From like, in the very beginning.

Charles Benton: 19:10
Yeah. So it's a little bit easier to get set up. Because, like I said, that partnership with that attorney, they really have to everything, they got to go get insurance with fidelity store title, whoever you kind of set up with. So all that part's done, then once it's kind of settled, it's really just up to that broker to push that production. And as long as they can, they can do that. So even if they are still producing, it's huge because they can obviously push their deals there. So the only differences is when we talked about US Attorney, not attorney states. So Florida is a little bit unique because the the seller, the listing agent picks the attorney there, it's in the contract or self basic. So you really have to make sure that you're leveraging with some heavy lifting agents to push. Georgia even US Attorney state. Any agent can kind of pick that so we got our ages now where they're pushing to have them. Because they build that relationship. They feel like it's, "Hey, this is my close turn, I can do this and they'll take care of it and pay it close", whatever it is. So it's an easier thing to kind of get going. Because you don't need, you need a good amount of transactions, don't get me wrong. Typically, it's like six to seven deals a month, to where it's profitable. And that's where, though to really kind of emortgage you can do two deals, and you're still making good money. But the title is so much easier to kind of spread out to everyone.

Nathan Daniel: 20:37
Yeah, okay.

Charles Benton: 20:38
Cash deals that matter, whatever it is, revise, boom, you know, you can kind of you still use the title.

Nathan Daniel: 20:44
Yeah, well, okay. Well, I think that gives us an introduction to it. And I think this has been a topic that I've been hearing a lot of lately is how do you create additional revenue streams inside of your brokerage once you're established? And you've done a great job of this? Because you've come far fast, right? Let's spend about two years that you've really started this journey, correct?

Charles Benton: 21:04
Yeah, sure was. And the most pivotal moment was getting out of production.

Nathan Daniel: 21:09
Yeah

Charles Benton: 21:09
That's what kind of allowed me to see the bigger picture in the tackett. It's hard to tack things like this, when you're producing running a brokerage, and so forth. Yeah. Well, I'd love the quote, that you said, when we're having a conversation, I'm gonna pull it up here. And it says "You can have growth or you can have control, but you can't have both." See, my coach says this to me regularly, because I'll be trying to micromanage or something, because I mean, "Which one you want, you want growth, you want control?" I was like, "I want both." He's like, "can't have it." So I've really learned to do that. And like I say, get out of production, giving up that control of all that, for the growth is, it's very difficult. Really getting out of production is probably the hardest thing in aging goes through it because they're given up some of their old past clients early. It's a goes on and on. But once you kind of grasp that, it's, really how far do you want to go? You know, how it is. So I always love that quote, because every time I start to micromanage again, I gotta check myself. No.

Nathan Daniel: 22:16
Yeah, well, I love that quote. And it reminds me of the whole quadrant, right? ESBI, and I know, I agree with you that moving out of production, we live in that S quadrant for so long, and we try to move over to B. And sometimes, like, once we're in B, and we have struggles, it's like, yeah, just go back to S and it's like, "No, I gotta stay over here. I gotta stay over here."

Charles Benton: 22:34
It's so easy to go back. You know, it's just, it's a challenge. It's something that has to be done for growth.

Nathan Daniel: 22:41
Well, alright, so everybody, today, we've been talking to Charles Benton with first class real estate, and we've been talking about how to leverage your brokerage to create additional revenue streams. Charles, thank you so much for coming and sharing your knowledge about this topic and helping start the journey with somebody who's looking to do some kind of ancillary business or, joint venture like this. So how can people connect with you?

Charles Benton: 23:04
Yeah, they can hit me up on Facebook LinkedIn, as best way will connect, if you want to go over stuff, absolutely. Trust me, I know the the pitfalls and the things to look out for. So I love just trying to explain my experiences and what can work but I've kind of strapped tried it all and done that. So it is, hit me up there and we can set the screenshare, call, whatever and kind of let you know what the things I've messed up on.

Nathan Daniel: 23:31
Alright, sounds good. Learn from somebody else's experience, actually. Alright, well, this is good stuff. Well, I'm going to drop the show notes. Like in the show notes. I'm going to put some contact informations like your Facebook and everything. So if anybody wants to connect with you, check the show notes. And we can go from there. So Charles, thanks for being on the show today.

Charles Benton: 23:47
Thanks so much. I appreciate it.

Nathan Daniel: 23:53
Thank you for tuning in to this episode of the broker to broker real estate podcast. If you like what you heard, make sure you subscribe to the channel. For more information, tools and resources. Go to www.brokertobr kerpodcast.com and always rememb r, Be You and Be Real. We'll ee on the next episode.