Many of you are a lot like me.  Entrepreneurial.  We’re constantly looking for opportunity, and when we see it, we often just naturally go for it.  Some of us more than others, depending on our place in life, our risk tolerance, financial ability, and the other things on our plate, but all of us, to some degree, learn to spot opportunity and react.  Such is the life of an entrepreneur.

I thought that some of you might find it enjoyable or even possibly instructive, if I were to walk you through the latest deal I’ve become involved in.  I am still in the midst of doing the deal, so we don’t have any final results yet, but since I’ve been writing and teaching about the “Virtual” mindset, this might be a good practical example of exactly how my company operates, virtually, as a 21st century company and how that is so different from a traditional company.

First let me give you the background.  As many of you know, our company is both a real estate company and a technology company.  The two are inseparable.  We are a virtual real estate company, working an age old industry a whole new way.  A better way.  And more importantly, a more profitable way.  A virtual way.

Technology is not an end unto itself.  It’s simply a tool.  But in the right context, it is a powerful tool and it allows us to function much more efficiently, much less expensively, at a much greater speed, with much more leverage and force, and with much more precision.  In short, it allows us to execute better, in every way.

Now, the set up.  Several months ago we became aware that a mid-size national real estate company was on the ropes.  It was losing money in a big way, and the management was seemingly at a loss as to how to bring it to profitability.  But I saw the value of the large network of agents who were practicing real estate across the country: at the high, somewhere around 2,000 agents.

If you’re entrepreneurial, you immediately start doing the math.  Two thousand agents, at five transactions per year, equals ten thousand deals.  If the company were to keep just 5% of an average gross commission income of let’s say $5,000 (a $200,000 average sales price times an average commission side of 2.5% nationally) then that would amount to $250 per deal times 10,000 deals or $2.5 million in revenues.

So after I did the math, I asked a friend and business associate to approach the President of the company and get as much information as possible, and to inquire as to his interest in selling the company.  It was important that we not disclose who we were, but simply to gather information and find out where they were, and whether there was an opportunity.  Information is power.  In any deal, the side with the information is always at an advantage, so we disclosed little for obvious reasons.

We learned that the company had recently closed its mortgage division.  We learned that the company still had a staggering corporate overhead and that the actual number of agents had shrunk to 1200.  We also learned that the average agent was only producing 4 transactions a year.  We learned that the company had negative momentum, and that the agent base was shrinking because of the company’s pattern of making grandiose promises and then never fulfilling them.

We learned that the President was not an owner of the company, but rather an employee making a fat salary with no tie to results.  We learned that the “promise of the moment” was franchising the company, and that our investigations showed us that not only was a national franchise not forthcoming in the near future, but that the company had not produced the basic foundational legal document to begin the process — the Uniform Franchise Offering Circular.

Our investigations indicated that the company had not even filed with any of the Secretaries of State or Corporations Divisions nor had they been approved for selling franchises in any of those states.  But all the agents had been led to believe that the franchising was imminent.  Hmmmmmm.  The plot thickened.

Meanwhile, we were being told that the franchise offering was right around the corner and that the company was in fine shape, financially, and simply needed some investment capital.  We weren’t told that the owner of the company had recently told all the agents that if the company didn’t turn around and become profitable, then he would be forced to close it.  We were offered the “opportunity” to invest a paltry $2.5 million, and that without any secured interest in the company or without becoming a stock holder.  Meanwhile, we began to get differing stories as to the actual number of producing agents.  It seems that the agent count included mortgage licensees (remember, the mortgage division was now closed), and “referral agents” (whatever that is).

While I was very interested in acquiring the company if the price was reasonable, it was apparent to even the most naive and beginning businessman that the management was either deliberately trying to deceive us, at the worst, or were themselves deceived, at the least.  The number of producing agents continued to be a lower amount, from 1200, to 1000, to 800, to now we were hearing rumors that the true number was far lower than that.

Needless to say, we decided to wait and see if the company had a reality check and approached us with a real offer.  On the other hand, if they continued in their denial, we would wait for them to fail and try and salvage the company’s only real asset: their agent base.  We continued to check in with the company President, every few weeks, just often enough for him to know we were somewhat interested, but not often enough for him to think we were overly interested.  As many of you know, posture, is critical in putting together good deals.

Then it happened.  We heard rumors in the industry that the company had closed their doors.  No warning.  No phone call from the owner (who was probably unaware of our interest in his company) or from the President.  Very strange.  Normally, a high-paid executive, knowing that his company is on the very brink of failure, will approach any and all potential investors and at least attempt to secure financing to keep his company afloat.  We knew something must have been up, but had no idea what it might be.

We continued to investigate, but with a large number of agents out of work, we knew that we had to act fast to take advantage of any opportunity and to protect our investment: all of our months of work toward this takeover.  I made a number of phone calls directly to the President of the company, only this time telling him specifically who I was and directly what my interest was in his company.  My phone calls were not returned, making it clear that he had no interest in speaking to me.

But by now, I’d already invested a good deal of time in this potential acquisition, so I decided to see if I could go directly to the agents.  What could it hurt?  So I networked until I found an agent who had been with the company long enough to know the ins and outs of the organization, from the confusing pay plan, to the structure of the multi-level marketing aspect of the company and how agents got paid to recruit other agents.  He even had the most recent agent roster.

After several lengthy conversations with this agent, and several others who had been associated with the company, I was able to fill the gaps in my increasingly clearer picture of the company.  It seemed that the most recent “true” agent count was 533 agents, or at least had been two weeks prior to them closing.  And now, with that agent roster, I was finally able to take a proposal to the agents.  But again, we had to move fast before the agents had all affiliated with other companies.

About the same time we learned of the company closing, we also learned that there were others who were trying to make their own plays for the company, only they had the advantage of a head start of somewhere between a week and two weeks.  One of the competitors was the company’s former President, who had reportedly been collecting a nice salary of upwards of $250,000 a year while the company couldn’t even manage to cover its month to month operating expenses.  Now his strange behavior made perfect sense.

Apparently, it’s much easier to run a company into the ground while on the payroll of the previous owner, and then steal the remains of that company out of the ashes, than it is to just go directly and honorably to the owner and offer to purchase the company while it is still a viable entity.  And that devious strategy is particularly easy to execute when the true asset (the agent base) is not actually “owned” by the company and when you don’t have any moral or ethical problems with stealing another man’s company.

But there was another suitor for the company’s agents.  Apparently another senior executive, who had formerly headed the company’s failed mortgage division, also saw the opportunity and decided to make a run at the company.  That senior ex-executive is now involved with yet another national lender as its President.  It should also be noted that his company previously had no real estate operations, whatsoever, and it remains unclear to us whether his new employer even knows of its President’s attempt to take over the failed company’s agent base and build a real estate company from scratch.

One thing we have learned is that for the last week and a half, two of the senior management of that national lender have been scrambling around trying to slap together some semblance of a real estate company, while simultaneously pitching agents from the failed real estate company, and attempting to sign them on with their own newly formed real estate company that’s never closed a single real estate transaction, has no agent infrastructure, has no agent training, and has no virtual office back-end in place to support those agents it does manage to hire.

Well, I rapidly assessed the situation and realized that if we were going to be able to have any reasonable shot at recruiting those out-of-a-company agents, we needed to move fast.  We were a week late (we didn’t have the insider knowledge that the two former executives had), we didn’t have any ready access to the agents — in fact, we’d just acquired the agent roster and learned who and where those agents were.

But in studying the situation, we also realized that we had some advantages as well.  First, and most importantly, we actually are a real estate company, with over 15,000 agents in our own global network of agents.  Secondly, we already have our own proprietary virtual real estate office platform in place.  In fact, we launched our first version in December 2005 and are currently testing our third generation.

Thirdly, we already have the agent training in place, with over 100 training videos, audio training, and thousands of pages of written instructional material.  We’ve had over 90,000 agents who’ve complete my on-line training seminars, thousands more who’ve read one or more of the four books or hundreds of training articles I’ve written, and hundreds more who have visited our company headquarters for our training summits.

The most important advantage we had, though, is that we are truly virtual.  Virtual and agile.  In fact, to the degree we are virtual, we are agile.  Virtual is not just a buzz word with us.  Our speed to market is incredible.  We often go from idea to implementation in a matter of days, while many of our competitors take weeks, months, and even years to develop even the simplest change to their product or service lines.

In summary, we have two formidable adversaries, both of whom have extensive history with the agents in this network, have a much fuller knowledge of the history of the company, and each of whom had between a week and two weeks head start.  We were two weeks later finding out (because we had no insider information) and we had to build our information base from scratch.  So, how did we go about meeting this huge challenge and attempt to protect and preserve a huge investment in time and resources in this potential acquisition?

Up until now, what I’ve shared with you is foundational.  Now, I’m going to lay out the strategy we devised to get our message out as rapidly as possible to the network of agents, hoping that we can attract many of them to our opportunity. Remember, the clock is ticking and the longer we wait, the more these agents will have scattered and affiliated with new companies and therefore be lost to us forever.  Follow with me as I lay it out, piece by piece.  I think you will find it both entertaining, but educational as well.  You’ll also see that we really do practice what we preach.

Step One - Planning. If you’ve taken any of my training you already know that I am huge on planning.  If you fail to plan, you may as well plan to fail.  So what did we need to plan?  First, we needed to get to the agents.  The best message in the world is worthless without anyone to deliver it to.  In our case, the agents were our leads.  We had to devise a plan to first identify them, and then to market to them so we could get our message out there in the midst of two competing messages.

The first step was finding an agent that had an entire, up-to-date, agent roster, and one that could fill in the blanks in our intelligence gathering.  After finding that agent, we made him an offer to secure the information we needed.  It was, of course, better depending on the value of the information.  I cannot go into any further details except to say that to the degree that our plan succeeds, to the same degree that agent will benefit.

Next, we had to take the raw information and reassemble it into a usable format.  We got a two-week old Word document with all the agent names, phone numbers, and fax numbers.  Unfortunately, we couldn’t obtain email addresses.  We used technology to convert that Word document into an uploadable CSV (comma separated values) format.  After cleaning up the finished file, we were ready to use our list.

We decided that the best way to get our message out quickly to the maximum number of agents was to hold a series of conference calls during which I could spell out the benefits of aligning with our company.  That approach would allow me to reach the most agents in the least amount of time.  In these calls, I could share our vision, and encourage those agents that were discouraged by the mismanagement of their previous and now defunct company.  I could offer them our plan — which incidentally is a much better plan — and I could show them the various opportunities they had to make money with our company.

How would we get the word out?  Since there were over 500 names to call, and since time was critical, we opted to use technology.  We decided on a two-pronged broadcast of both Voice Broadcast and SMS text message broadcasts.  We also decided to use two different types of Voice Broadcast technology: live answer and voice mail.  Both work differently, and with both, we were able to scrub each list against the National Do-Not-Call List before beginning the broadcast campaign.  We also used a SMS broadcast, and scrubbed that against the DNC list as well.

Next, we had to acquire an easy to remember domain name, and build a special website that was designed to do three things:  solidify our agents’ interest, get them to one of our conference calls, and gather the additional information we needed.  We designed the site so agents could register for a conference call of their choice and give us their email address so we could followup with them.  We also asked registering agents for their production volume and the number of agents they had recruited.  We used a design that allowed us to check all registrants against our database, and then add any new information to that data record.

Then I had to craft our message, and we had to produce a video of me sharing it.  The message of the video was simple:  Identify with the agent’s pain and frustration (easy enough since I was feeling the same frustration dealing with this company), acknowledge their lack of trust and validate it by giving them plenty of real-world evidence that we were not another pie-in-the-sky company, and finally create enough interest in our opportunity that they would show up for the conference call (and give us the additional information we needed).

Finally, I would have to do a great job communicating our value proposition to these gun-shy agents if we were to convince them to leave the very people who had taken advantage of them, but with whom they felt comfortable.  I had one chance to make a first impression.  I had better bring my “A-Game” to the conference calls.  I will have to face a large crowd of frustrated agents who are predisposed not to trust anyone.  I also have to sell them on me, on our company, and finally on our company’s value proposition to them.  Now that is an ambitious plan!

Step Two - Assemble the Team. I selected the people in our company, based on their expertise.  I first met with our heads of agent coaching and customer service.  Next, I met with the managing broker of our local team who helps me with various development projects.  He and I have worked together since 1987 and he has a great feel for business.  Then it was on to our technology development team where we discussed building the website, the information interface, and the database.

We discussed the time sensitivity of the project, and we talked about only getting one chance to make a first impression.  Then I met with my head of video production and graphic design and we started getting ready for the video shoot.  I wrote the script and had my director of communications proof the message and help refine the message into a 6-minute video.

Step Three - Build the Infrastructure. Next we all began our various projects.  I wrote the scripts for the voice broadcast and the SMS broadcast, as I had previously written the video script.  I also wrote the copy for the website landing page, the thank-you page, and the email responses from the website.

With our Live Answer Voice Broadcast, we first recorded an outgoing message to be played.  Then we uploaded the contact list and the computer system dials the numbers, and then whenever a live person answers and says, “Hello!” (or anything for that matter), the computer then begins to play our pre-recorded message to the recipient, and then records the call delivery analytics.

Here is the script we used for the outgoing message I recorded, with the name of the target company disguised for privacy sake.  Recorded message to live answers:

The Voice Mail Voice Broadcast was similar. Again, we first recorded an outgoing message.  The computer system again dials the list, and if it gets a live answer, it hangs up.  On the other hand, if it gets an answering machine or voice mail box, it then waits for the outgoing message to play, and when the message is complete, it pauses a second and then begins to play our pre-recorded message, and again, records the analytics.

Here, again, is the script we used for the outgoing message I recorded, again, with the name of the company omitted for privacy sake.  Recorded message to voice mail answers:

Next we used SMS or text message notification.  We hypothesized that many of the phone numbers were cell phones, since that is the agent’s life blood in the modern age of real estate.    Here is the SMS Text message we sent:

Now it was time for our website.  We secured a domain, “myCompanyXplan.com” where we could build a website that we designed to both solidify these agents’ interest and allow them to register and give us their email address so we could follow-up with them.  We built the back-end database so we could collect the agent information that came in, allowing us to continue to learn and fill in areas where our intelligence was still not perfect.

When we had all the pieces in place, all the data loaded into our various campaigns, and after we had tested everything several times over, we were finally ready to pull the trigger.

Step Four - Execution. At last it was time.  The Voice Broadcast campaigns had taken us a couple of days to set up, and test.  The SMS Text Message Broadcast system had taken us a day.  It took us two full days to build the website, the auto responses, the database, and the information interface.  The video had taken us two days, from scripting, to shooting, to producing.  Finally, we were ready.

But I wanted to give the others (our competition) a chance to work with us.  One last call to one, and two to the other.  No responses.  We had no choice.  It was finally time, and we were ready.  I gave the word after lunch Friday to pull the trigger and launch our plan.  The final results are yet to be seen.

What have we learned?  We’ve learned a lot.  First, we almost crashed our website server by the response from the first wave of Voice Broadcasts.  By the end of the afternoon, we had registered a network of 110 agents who were universally anxious to hear what we had to share.  That was simply our first wave.  We have several more planned.

We learned that the average agent that registered completed 5.7 transactions last year.  We also learned that the average agent had recruited 4.2 agents with that company, and that of all the comments we received, not a single one was negative.  These agents are highly motivated to find a good solution, and very happy to discuss one with us.

We learned that our two competitors are very nervous.  We included both of them in our campaigns, and both contacted my third party business associate (the one who had been working on the acquisition with me) within hours of our campaigns going live.  I won’t share the exact content of those communications, but suffice it to say, they are extremely surprised and amazed at our speed in pulling this together.  One has already conceded that we will likely recruit many of the agents.

We learned that every single agent that contacted us intends to be on the very first available conference call.  That communicates volumes to us.  They are all very frustrated with the way they were left hanging, and many of them have transactions hanging in the balance and are extremely interested in signing with a company that will deliver on its promises, and deliver on them quickly.

As we continue to execute, we will learn more and more, I am sure.  We have had lots of conversations and have already begun to sign agents simply by their calling us, checking us out, and making the obvious decision.  We’ve begun to execute what is the quintessential virtual marketing campaign.  We didn’t have to plan it in committee meetings for weeks.  We didn’t spend months developing the infrastructure.  We didn’t assign a room full of people to make phone calls and do a poor job communicating a very critical message — we used the power of technology.

The story is far from over, but there have already been many lessons learned so far, and I thought it would be beneficial to share them with you.  After the smoke has cleared and the entire deal has been completed, I’ll be happy to follow-up and fill in the remaining blanks for you.  I’ll probably even give you the specific names so it will add a further sense of legitimacy.  I’ll even share the website and the information interface with you.  In the meantime, I will leave all the names blank — I still have hopes of working with my competition in this deal and certainly don’t want to burn those bridges until I have no choice.  Stay tuned…