Editor’s Note: This is the cover story in the October 2021 issue of RISMedia’s Real Estate magazine. Subscribe today.
HomeSmart Believes the Right Business Model Will Always Win. Here’s Why.
The competition is fierce as brokerage companies pull out all the stops to provide a better future for agents. With no crystal ball to predict who will come out on top, one thing is clear: A company that values evolution and choice will always win.
Today, it’s no longer about being with the right brokerage model. Instead, it’s all about the right business model—a distinction that’s behind every decision and every iteration of brand evolution at HomeSmart.
HomeSmart is moving full-speed ahead—adapting to every new environment so that as the future unfolds, the brand will still be going strong no matter who else is at the top of the leaderboard with them.
With an agent-centric, technology-powered business model—and the freedom of choice built into each and every step along the way—HomeSmart is empowering its agents from every angle and adapting to new environments in numerous ways.
Business Model vs. Brokerage Model: A Key Point of Differentiation As a trend-setting, cutting-edge company, HomeSmart provides dedicated broker support, proprietary systems and tools, flexible fee plans, and marketing and transaction services.
But that’s just the beginning.
Laser-focused on helping agents serve their customers, HomeSmart was built on a service mindset that’s delivered upon through technology and scale.
Permeating every aspect of the business, HomeSmart provides power of efficiency and the ability to leverage any type of go-to-market strategy via its proprietary technology platforms.
“Because of the vision and proprietary technology built into the organization, we can support a number of different types of models,” says HomeSmart President Ashley Bowers, underscoring the importance of recognizing the difference between brokerage models and business models.
While a brokerage model is simply a fee structure, a business model constitutes everything behind that. It’s operational excellence, high service, offices, people interacting with people, technology and marketing.
An ongoing conversation among real estate practitioners, there’s no shortage of discussions surrounding which brokerage model is the right way forward.
“Our agent-centric business model provides both flexibility and optionality so that agents don’t have to stick with one type of brokerage model,” says Bowers. “We can offer a variety of fee plans to fit both the situation and needs of any particular agent, all of which goes back to providing agents 100% of the resources they need to be successful.”
Brand Evolution and Technology’s Leading Role A key component of HomeSmart’s brand evolution, technology has played an integral role since day one.
“We’ve focused on technology from the very beginning, and rather than using it as a barrier between ourselves and our agents, it has been an important piece of the puzzle as far as helping our agents grow their business further,” says HomeSmart Chief Industry Officer Todd Sumney.
By utilizing technology to gather all of the information an agent needs and placing it at their fingertips—whether it be on their mobile phone or company dashboard—HomeSmart has remained focused on core competencies. This has paved the way to providing extremely high service and support in addition to a large amount of value through technology and service…or what the brand refers to as its recipe for success.
“As we’ve continued to evolve, it’s become clear that many people working in the industry didn’t even know that the opportunity we provided at HomeSmart existed,” explains Sumney. “In a way, we were the best kept secret in real estate; however, we needed more agents to know about it.”
Building in and offering flexibility for agents in every aspect of the business has allowed the team at HomeSmart to adapt to any agent’s need no matter where they are in the country or within the lifecycle of the real estate business they’re in.
“By focusing on innovation, collaboration, tools and resources—and empowering agents in every way with technology—we serve them and help them evolve as well,” says Sumney.
As the real estate industry continues to change for both practitioners and consumers alike, HomeSmart has cemented its spot at the forefront of the evolving landscape.
One of the first companies to embrace the shift toward moving transactions online and becoming 100% paperless, HomeSmart has always been on the cutting edge.
“We were able to achieve this goal through our own technology,” explains Sumney. “Because we still own brokerages and we’re working in the business every single day, we know when something needs to evolve and get better. So we’re constantly honing the system so that we can do an extremely high amount of transactions in a very efficient manner.”
“At HomeSmart, our focus is technology,” adds Bowers. “The technology is really about being able to get more transactions across the finish line and remove the friction and tension from the process while being less about providing flashy tools that don’t necessarily lead to a successful close.”
Another aspect of the brand’s evolution that has helped position HomeSmart ahead of the competition is HomeSmart Founder and CEO Matt Widdows’ philosophy of never taking “no” for an answer.
“That’s a big piece of who we are as a brand,” says Bowers. “While many companies within the industry defer to saying that things aren’t possible, we take a different approach by asking, ‘Why can’t we do that?'”
This simple mindset shift can be found throughout the organization, laying the foundation to ensure that progress isn’t obstructed.
“One of the biggest things we’ve done is integrate all of our technology together into one real estate ecosystem,” says Sumney. “We’ve eliminated all the pain points and have made it easy for agents to scale their business while offering deeper engagement for the consumer.”
Along with providing a higher level of service, HomeSmart has kept the REALTOR® at the center of the transaction.
“So many companies in the real estate industry try to remove the agent from the process, but we believe that the agent is the center of the transaction,” says Sumney. “Instead of displacing them, we empower them and enable the consumer to engage with them on a deeper level.”
The Power of Choice in an Ever-Evolving Landscape There’s no shortage of choice within the real estate industry. From deciding which company to work for to the type of clients you’d like to represent and the best market to launch your career, agents are inundated with an overwhelming amount of options.
While having too many options at your disposal can often be counterintuitive, at HomeSmart, it’s all about choice.
In fact, as we head toward the future, it’s going to become increasingly important for brokerages to continue providing choices for agents so that they can adapt to the market—no matter what it looks like.
“We offer agents 100% of choice in many different areas, beginning with our ever-popular flat-fee model and 100% commission on all sales and rental transactions,” says Sumney, who goes on to explain that the company recently announced additional options as it relates to fee plans.
Enter HomeSmart+, HomeSmart’s newest commission plan.
Designed to provide a way for agents to earn additional income beyond their own transactions, and an opportunity to earn money into their retirement, the HomeSmart+ revenue share program allows agents to earn money when their referred agent closes a transaction.
Giving agents yet another choice as to the way they can run their business, HomeSmart+ is the next step in the brokerage’s continued growth.
Choices abound in other areas as well, including education, training, mentoring and technology.
By providing optionality in these key areas, agents can choose the pathway that’s best designed to help them meet their goals.
Depending on their specific needs, HomeSmart agents can work at their own pace so that they’re totally in control.
“Some agents want to have a mentor, while others want to join a team, so we give them the freedom to choose what works best for their own situation,” notes Sumney.
The same philosophy applies to education and training, as some agents prefer a remote or in-person learning program that has structure, while others would rather do it on their own.
Agents even have options when it comes to the technology they use within their day-to-day routine.
There is, however, one tool agents across the company must use.
As the industry continues to change and evolve, determining what else should be brought to the table centers around listening to what agents, brokers and franchisees, as well as internal HomeSmart employees, are asking for.
“We feel that knowledge is power, and we want as much information and input as possible,” adds Sumney, who wholeheartedly believes in the power of choice.
A brokerage built by a broker, for brokers, and a real estate company built by an agent, for agents, HomeSmart is in a unique position to see first-hand exactly what agents need, whether they’re in the first phase of their career or working at a more advanced level.
Courage Through Leadership: Setting the Stage for Change Great leaders come in all shapes and sizes, but one thing they have in common is the courage to push through uncomfortable situations.
Now more than ever, people want leaders who have the strength of mind to make the hard decisions that will ultimately bring about change. And that’s exactly the type of people who make up HomeSmart’s leadership team.
“As leaders, we’ve all vowed to never be in a situation where we look back and say, ‘We should have changed or made a pivot here, but we didn’t have the courage to do so,'” says Bowers. “We’re okay with making mistakes here and there as we put ourselves in a vulnerable position when trying something new and different, but keeping this spirit alive will help us continue to lead in this space.”
Coming from outside the industry herself, Bowers understands the importance of a diverse leadership team made up of individuals from all walks of life.
No matter what type of experience a leader brings to the table, grit and determination are two qualities that can’t be overlooked.
“We’re always looking for those who want to join the revolution and who like to run at warp speed, which is something we can get a sense of very early on during the interview process. We want people on the team who truly believe that there’s no job too small or too large,” says Bowers.
“The people who join HomeSmart are typically on the rebellious side anyways,” adds Bowers. “They tend to do things differently, and that fits with the overall vibe of the brand.”
Reevaluating Your Business Model to Keep Up With the Competition As real estate brokerage companies contend with change rather than simply resting on their laurels and sticking to what they know, they must get to a place where they’re comfortable being uncomfortable.
While it may sound like a challenging proposition, in keeping with the stages of business growth, broker/owners should reevaluate their business model every two to three years.
“You don’t necessarily need to change your business model entirely, but you need to question it because everyone around you will be questioning it,” explains Bowers, who urges those at the helm of brokerage operations to ask themselves three important questions: Is it still right? Is it still working? Is there something that needs to be added?
To help brokers with the process, HomeSmart leans on every member of the organization to share where they see the potential for opportunity as well as what they believe the brand can do to stay ahead.
“So much of the reevaluation process is the eyes and ears that are on the front-line,” says Bowers. “We want to know what they’re seeing and hearing in addition to what parts of the process are causing frustration.”
Paying attention to the competition is also important, as one of the first steps in revamping your own business model is understanding how you stack up against others, finding the whitespace to compete.
“Look at the competition and see how their growth compares to yours,” says Bowers. “Are they staying the same, or are they growing faster or slower than you?”
Sizing up the competition also includes being aware of organizations outside the industry that could potentially get their foot in the door and change the real estate landscape as we know it.
Preparing for the Future The future is looking brighter than ever at HomeSmart as the brand hunkers down and prepares to raise the bar higher when it comes to what they’re offering real estate agents—and how they’re positioning them for continued success no matter what transpires.
“We’ll continue to provide agents the things they’ve come to love and expect,” says Sumney, which includes office access, brick-and-mortar locations, support, personnel on the ground and in every market, training, mentoring and marketing resources.
Sumney concludes, “As we work toward the future, we’re 100% committed to providing a full-service brokerage with both remote and tech-driven capabilities.”
As an Associate Online Editor, Jordan Grice produces a mix of content and reports for RISMedia’s online publication, daily newsletters and Real Estate magazine. He also plays a role in writing, editing and publishing content featured in RISMedia’s RealEdge Podcast page. Prior to joining RISMedia, Jordan has served as a journalist for Hearst Connecticut Media Group, The Republican and Local Voice Media (now Local Daily Media).