The FavoriteAgent.com Story

The following article written by Matt Jones was originally published in Broker Agent News on March 23, 2007. It is presented here in its entirety as it was originally published. While non-commercial use of this copyrighted material is encouraged, unauthorized, commercial use is strictly prohibited.

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As I sit down to write this article, I’m smiling. I realize just how fortunate I’ve been. I’ve truly been blessed in this, the greatest business in the world - the real estate business! So much so that it seems surreal. Hardly a day goes by that I’m not asked how I managed to start as a rookie agent in June of 2002 and in less than five years grow to be the president of a large real estate empire, with over 5,000 agent partners around the world, a real estate franchise operation that’s opening offices in markets across the US, and still the broker of my own local real estate firm, managing well over a hundred agents (making us over twice the size of the nearest competitor). This year my local brokerage will close over 1,000 transactions and grow to 250 agents. Even though my market is below average, real estate has been very good to me… God has been very good to me.

The difficulty of telling my story is, on the one hand, I don’t want to seem proud or boastful, but on the other hand, I don’t want to deprive other agents of the opportunity to both avoid my mistakes and benefit from my success. Almost daily, when I sit down with agents who come to join our firm, we always take the time to tell them my story - this story - and it’s very effective. Not effective in the sense that we ultimately “close the sale” (although we almost always do), but effective in the sense that it’s inspiring and it helps new and struggling agents alike understand that they too can share the same kind of success that I’ve enjoyed.

I continually remind people that I’m not special. I’m surely not a rocket scientist! I’m just a regular guy - no different than most of you reading this article. I didn’t have a lot of wealth or connections. All I brought to real estate were a willingness to work hard and common sense. But you’ll see soon enough as you read my story. I trust that you’ll be inspired by reading it, and if you’re willing to apply what I share, your practice will never be the same again.

It all started in March 2002. After twenty years of owning automotive repair franchises, I decided I needed a change. Economists were reporting that each new year the real estate market was better than the years before it. Interest rates were at a 40-year low. More houses were being bought and sold than at any time in our nation’s history. It seemed only logical that as echo boomers got to home buying age, and at the same time, baby boomers were at an age they were buying second homes and investment homes, that the real estate industry would experience phenomenal growth. So I decided that real estate was the new career for me.

During licensing school, I read every book I could find on the subject, listened to every tape and CD, and talked to everyone I knew in the business. I was excited, and I put together a business plan. I could hardly wait to get my license. When I got my license, I followed the conventional wisdom, doing all the things the “experts” had told me to do. Was I ever surprised to learn that none of it worked! I was working twelve hours a day, seven days a week, and having little to no success. I was so frustrated that I nearly quit the business. When I got to the end of my rope, and near the end of my savings, I took a day to be alone and determine whether I had simply made a bad career decision. After looking for direction that day, I came to a simple conclusion: real estate was a great opportunity, but I was going about it all wrong. Common sense told me many of the conventional techniques that I had been taught were just bad ideas, or good ideas whose days had passed. So I decided to take matters into my own hands.

First, I noted that technology, especially the Internet, had changed just about every single industry during the previous few years. I thought, “Why should real estate be any different?” I determined to use technology as a way to build my business and particularly attract customers. By this time I already had a website (doesn’t every agent?), but unsurprisingly, it was horrible at capturing new customers. What’s amazing is that it had everything the experts said I needed. It had several thousand pages of content, from mortgage information, to school information, to community information, to property searches, to weather, and much more. Although I had been taught that this was what the customer wanted, I knew something was wrong.

So I decided I would find out what customers really wanted. I made it my mission to figure out how to capture website customers. And slowly but surely I got good at it. My old web site captured about 1% of my traffic (unique visitors). But as I began simplifying my website, I slowly raised my capture rate to 6-8%. Then one day in early 2003, I made a discovery that helped me to double my capture. Now I was getting excited! No websites I’d ever heard of captured even close to 10%! So I began to focus even more on testing and measurements, and I slowly got the capture rate up to nearly 15%.

Then in May of 2004, I made another discovery that again nearly doubled our capture rate. The simpler our website got, the greater our capture rate became! We continued to test and measure, and we eventually got our web capture rate to over 30%! We tested everything: fonts, colors, icons, web elements, programming languages, database table structure, value propositions, use of marketing phrases, and much more. Nothing was left untouched. And the results were very predictable: the better we got at capturing customers, the more business we had, and the more transactions we ultimately closed.

Now while all this was happening, my business was growing so fast that I had more customers than I could possibly handle on my own so I began to build my own team of agents to help me handle all the phenomenal volume. Before long, word of my success got out and I was asked to speak at some national conferences. And as you can imagine, a new agent like me, with the kind of volume I was doing, received a lot of phone calls from other agents. Pretty soon I was spending half my day on the phone with struggling agents who were begging me to help them with their websites. The experience was frustrating for me because it seemed that for all the time I was spending, I wasn’t able to help many people. I soon realized that most agents aren’t computer programmers, and they don’t want to be geeks - they just want to do what they do best: work with buyers and sellers.

Then one day it occurred to me that I could simply build the technology as a stand alone Lead Capture Module (LCM® Gateway) and simply allow agents to license it and place it in front of their existing websites. So I asked the twenty or so agents I had been helping what they thought about the idea, and they were all thrilled! They didn’t want to design their own technology - they just wanted to benefit from being able to make their own low cost leads. So we beta-tested the idea for about four months to see if it would work. And did it ever! Our small group of agents started making their own leads very inexpensively - for as little as $2-3 per lead, using our LCM® Gateway. It was time to go into the technology business.

So in April of 2004 we officially opened our technology division, working out of the living room in my house. Believe me - running my real estate team and my technology company from my house was crazy! Soon I had about 5 full-time “geeks” and customer support personnel, as well as the dozen agents on my real estate team, and the living room was getting very crowded, so we rented 1,000 square feet of commercial office space. I was fairly sure that we’d never fill it, but I wanted some room to grow. At the same time, my real estate practice was continuing to expand, to the point where we actually outgrew the Century 21 franchise where I practiced. We decided it was time to take our twelve agents and start our own company, and FavoriteAgent.com real estate was born.

The pace was getting quicker - everything was starting to accelerate. Within five more months we had outgrown our brand new office space. So in December of 2004 we moved again - this time to a space that gave us more room to grow. I assumed that 5,000 square feet of office space would last us for a long time, but remembering how we had filled up the 1,000 foot space, I was a little nervous about going too small. By this time, our local real estate company had doubled in size to 24 agents, and our technology company had grown to a staff of 12. We were simply trying to assimilate the unbelievable growth! We’d relocated to a place where we would never need more space, right?

Wrong! In fifteen months we needed more space again. The local real estate team had grown from 24 to 65 agents, and we’d become the largest brokerage in our market. So we expanded another 3,000 square feet, and in three more months we had a sales force of over 100 agents. That’s when we helped one of our agent team leaders open his own FavoriteAgent.com franchise, the first of five area offices, with a combined agent force of 150 agents! This year our local real estate team will expand to 250 agents while the other area FavoriteAgent.com offices will likely add another 100 agents!

While our local team was growing at a phenomenal pace, our national team was busy expanding our technology division, to now over 5,000 technology partners in all 50 states, Canada, Britain, Australia, and New Zealand. We added two new technologies to our popular lead capture technology (or LCM® Gateway). We spent over two full years developing a state-of-the-art contact manager called Pipeline. We determined to give away this full featured contact manager to agents around the world, free of charge, whether they licensed our lead capture technology or not. We also decided to give away the simple website (Agent SimpleSite®) we use for our local real estate practice. We make it available to any agent who licenses our LCM® Gateway.

In short, our growth has been astounding! In four short years, I’ve gone from being a rookie agent ready to quit the business to the president and CEO of a large real estate and Internet technology company. We’ve been featured on Radio America Network’s Equity Strategies and recently on CNN’s Pulse on America. My two books, LCM: The Secret to Success in the New Age of Real Estate, and The Ultimate Listing Presentation have been very well received, and over 60,000 agents have taken my listing seminar learning exactly how I listed 114 homes in my first year, all at 8% or more. Many of those agents are using this same approach to list at a premium in their own markets.

As you read this, I hope you’re motivated and inspired. Those who know me realize that I’m not some “super agent”. I’m a regular guy who’s had an enormous amount of success in a short period of time. But before you dismiss this and say, “Well good for you, Matt”, there are really a few simple things you can do to have the same kind of success in your own practice. No kidding. Let’s look at what the lessons are from this story, and how they can be applied to your business to help you accomplish your dreams.

1. You must solve the customer problem… or I should say, the “no-customer” problem. Without customers you can be a great agent and not make any money. By the same token, with an abundance of customers, even marginal agents still make lots of money. Just imagine if you had an abundance of customers and you became a very good agent! The payoff would be huge. So you must start with creating more business than you can handle.

2. You should figure out what the crowd is doing and try your best to do the polar opposite. The crowd is always wrong. Bank on it. When you don’t know how to react to a particular business decision, stop and figure out what the crowd is doing. Do the opposite. When we started our technology division, we hired a room full of telemarketers like every other technology company. We didn’t even think about it. It was just a knee-jerk reaction. But after we gave it some thought, we closed down the entire sales floor. Today we sign more technology partners than ever before, and yet we don’t have a single salesman. If everyone’s doing it, don’t. Instead, determine how you can do something different. Very different.

3. Be ruthless about tracking your numbers and metrics. They will often tell you what you need to do. In my case we track website metrics like visitors, unique visitors, number of leads, and cost per lead. I also track agent production numbers, market statistics, advertising cost per lead, and many other numbers. My real estate practice is a business, and I run it like one. I make many important decisions based on hard data and not on feeling. Had I not tracked my web metrics, I would never have known as I improved my website. Many of the changes were not changes that I wanted, but rather what the numbers told me needed to be made. Many of my advertising decisions are not what I would have chosen, had I not had the hard data.

4. Go with your gut. In my case, all my training and all the experts said one thing, and yet in my gut I knew it wasn’t right. Don’t worry if it is not what everybody around you is saying. The crowd is virtually always wrong. The fact that nobody else sees it can be confirmation that you are onto something good. You must believe in yourself and trust your instincts.

5. Always trust common sense over conventional wisdom. In my case, it was common sense that the Internet had transformed every industry. Why should real estate be any different? It was common sense to build a team to help me with my customers. It was common sense to begin licensing technology to agents instead of spending hours every day unsuccessfully coaching them to build it themselves. It was common sense that motivated our building Pipeline (our free contact management software). It’s common sense that made me start moving toward simplicity on the Internet. When in doubt, use common sense.

6. Continue to invest in infrastructure. Much of my success came because I didn’t limit my growth by under-investing in infrastructure. It was a sacrifice to get 5,000 square feet of office space when we only needed 2,000. But that allowed us to grow to the next level. Many businesses are like root-bound plants. If you want to grow, you must leave yourself room. One of the biggest hindrances to mega-growth is investing for where you are and not for where you intend to be. If you believe in yourself, don’t be afraid to invest in yourself. When I began, I had no plan to grow a team, no plan to have my own company, to build an Internet division, to develop our own software, write books, do video production, teach seminars, or many of the other things that now are part of what I do. Each of those growth steps came with a large investment of both time and capital, but that investment is the cost of growth.

7. You must persevere. Perseverance is crucial. Many days the pace and the burden seems overwhelming. Keep taking the next step. Scripture says that God will not allow us to be tried beyond our ability to bear it. I can say from experience that when I endure when I am at the point of throwing in the towel, it invariably leads to a major breakthrough. Think about my beginning. I nearly quit the real estate business. What a tragedy that would have been! Don’t cut your success short by giving up too soon.

8. Finally, there’s the principle of reciprocity. In this world, we ultimately reap what we sow. What goes around, comes around. As I’ve built my business, I’ve always focused on making those around me successful. The principle of reciprocity is why we give away most of our technology. It is why we give away our training. If I want to reap success, what do I need to plant? Success. How can I do that practically? By making those within my influence successful. And that’s why I write. That’s why I teach. That’s why we spend so much giving away technology to agents. We know that it will come back to us in our success. Clearly, it’s working.

Well, that’s my story. I hope it’s been a help to you. Maybe it’s inspired you to do what’s in your heart. I hope so. If you take anything away from reading this article, make it this: being successful in this industry is not a matter of luck. It’s not a matter of extra special talent. It’s not a matter of having the right connections. Actually, it’s very simple. If you’ll follow the simple steps I’ve outlined above, you can be every bit as successful as I’ve been - maybe even more successful. The real question you need to ask yourself is this: are you willing to give it a try? If you’ll do what I did, I promise you’ll have the same or even better results. You’ll build your own dream!

Editor’s Note: Matt Jones has been a long time contributor and supporter of Broker Agent News - helping to change many agent’s lives. You could be next - Learn Matt’s actual listing presentation that landed one agent over 9 listings each month—while charging 2% more than his competitors!