Exit It’s Not Just a Sign, It’s a Calling FROM: RIS Media Realty Magazine, March 2003, Cover Story Exit Realty’s Unique Approach Draws Thousands to Growing Company By Beth Bresnahan After rising to the top of her game in 1999 as one of the real estate industry’s most successful franchise salespeople, Tami Bonnell felt there was still something missing from her career. Many aspects of her job were truly rewarding: Helping people start their own business, negotiating, networking and, of course, earning a great living. But the nature of this ego-driven business was becoming severely competitive and the return on invested time was decreasing for everyone. The mere fact that a real estate agent is only as good as his last transaction motivated her to seek out a new way of doing business. She felt there had to be a more positive and productive met-hod to create a future in this industry for both the salespeople and the brokers. Bonnell says her dream came true when she discovered EXIT Realty Corp. International. She recognized that Exit’s unique approach was the solution she was looking for. The Beginning of Something Big Exit was founded in Toronto, Canada in 1996 by CEO Steve Morris, an industry broker of over 26 years experience. The unique formula of this corporation is based on single level residuals, a concept that he learned during his career in the life insurance industry. Bonnell saw the opportunity and the potential immediately. Bonnell was ranked among the best franchise salespeople in the world and she worked for some of the most competitive national brands for more than a decade. Says Bonnell, "I purposefully booked an appointment with the Exit people with the intention of exposing all their weaknesses by comparison to my corporation and thus eliminating them as competition. If there was anybody in the industry that was capable of debunking their new formula, it was me. "Of course I was skeptical at first but then it struck me. This idea of perpetual remuneration was absolutely unbelievable," she continues. "The numbers were right, the strategy was precise and the philosophy was irresistible. I sat there in a state of chagrin, my only regret being that I hadn’t dreamed it up myself." Bonnell bought the entire New England region and went on to become president of Exit Realty Corp.’s U.S. operation based in Burlington, Massachusetts. The 42-year-old Bonnell emphasizes that the one thing in common with all regional owners, broker/owners and salespeople is the belief that discovering Exit was their destiny. Each person has a vested interest in the growth of the corporation because they all have the opportunity to get a "piece of the action." Residuals proved to be the unique ingredient that triggered a friendly, supportive and nurturing environment with unlimited financial returns. "For me empathy orientation was the real difference," Bonnell says. "With residuals, our people benefit financially from helping each other. Wisdom is passed down at every level. Exit has certainly given a new definition to the word mentoring. You simply can’t find this in any other corporation." There has almost been a land rush mentality when it comes to buying up the remaining regions offered by Exit. Over one half of all regional opportunities were sold last year and now only 25% by population remain available. Since 1996, agent growth has doubled every year. With over 4,000 salespeople and 290 franchises sold throughout Canada and the U.S., Exit’s momentum continues to grow. The progress is substantial and the goals are lofty. An agent count of 10,000 is the year-end target including a total of 600 franchises sold. "Our formula is doing great things for people" says Bonnell. "The process has taken on a new life of its own. People are joining us from other companies because we are offering a pay structure that is helping them create a fabulous new future. They simply can’t get this anywhere else." The Formula The Exit formula works like this: Whenever a salesperson is introduced to management and recruited into Exit, the transactions that the new recruit closes generates a bonus, payable to the individual who sponsored them into the company, which is equivalent to 10% of the gross commissions earned by the recruit. This later translates into a 7% retirement program and a 5% beneficiary benefit. In other words, whenever the person who you brought into the company makes a sale, you get a bonus. You get 10% off the top for as long as they stay with the company and generate business. This bonus, paid via Exit’s head office on the closing of the transaction, is not subtracted from nor otherwise affects the commissions of the new recruit and it continues perpetually for as long as the new recruit stays with Exit and generates sales, even after you retire. Sponsoring is unlimited across the nation. Wherever Exit Realty has an office, salespeople can get residual bonuses. Management and the sales force work hand in hand to build the corporation. This creates an all-encompassing building mechanism with built-in stabilization. Each person can tap into the energies of others and create financial leverage with unlimited income streams. This method benefits everyone and completely eliminates the "me-first" attitude that dominates the old brokerage models. J.T. Leachman, broker/owner from Exit Realty in Marietta, Georgia bought the second franchise sold in that state two years ago. Before Exit, he was a top producer for one of the largest companies in Atlanta and in the process of building his own support team to streamline his business. He discovered Exit when the company’s introductory audiotape arrived in the mail one day. "I knew immediately, the solution was right there," says Leachman. "It was so simple and so clear, it just blew me away." Together with friend and software owner Dwayne Mitchell, Leachman began researching the purchase of a franchise. "We had looked at many different franchises and there just wasn’t anything that had much incentive," Mitchell says. "The Exit tape excited me but I hadn’t previously heard of Exit and I thought it might be risky. Then, we went to a ‘60 Minutes with Exit’ presentation and all fear was eliminated immediately." "We just knew that this was the group we wanted to be involved with." Leachman adds. Exit gives the salespeople a great opportunity to earn a living without having to work 24 hours a day, seven days a week—and build a retirement—What else can you ask for? Exit is a phenomenal concept." In less than two years, Leachman has grown his Exit franchise to 43 agents and competes successfully with the largest franchises in the state. Building a Powerhouse Executive Team CEO Steve Morris, 56, started the company in Toronto after extensive research on the residual concept and how it could be matriculated into the real estate industry. Residual remuneration was common in the insurance industry and in the music business but it had never been considered as a viable methodology in real estate. Morris launched the corporation on Sept. 3, 1996 and began the intricate process of building a powerful executive team. Joyce Paron was hired as president of Exit’s Canada operations along with Bonnell as president of U.S. operations. The success that this organization has experienced is only the tip of the iceberg for Morris. He, Paron, Bonnell and a troupe of sales trainers travel constantly, conducting training classes and extolling the many benefits of Exit to the masses. "The main frame of our company is made up of some of the finest players in this business and we all possess absolute conviction to accomplish one mission—to build Exit into the largest and most productively successful real estate operation in the world—bar none. Our mission is deliberate. We are setting out to outflank our competition in their every endeavor." The key word with Exit is "potential." Morris puts the earning potential at Exit in perspective like this: Let’s say a person earning $70,000 gross per year generates $7,000 in bonuses to the sponsor from closed transactions. If that same recruit stayed for nine years as an example, the sponsor would have received $63,000 in residuals. All of this acquired by simply introducing this person to management. Multiply that by three people sponsored in who do the same level of production. That’s $189,000 over nine years. "Who could walk away from that?" Morris says. Sponsoring is like paying the opportunity forward. You receive 10% off the top of those who you sponsor into Exit and then they have unlimited opportunities to sponsor in as many others as they choose any place Exit exists. Exit associates can do this right across North America for the rest of their entire lives. The possibilities are endless. "We now have a number of individuals earning six figure incomes from sponsoring alone. They each know, before getting out of bed every morning that they are going to earn well over 100,000 annually no matter how much they personally produce. That’s security," says Bonnell. "An individual sponsoring in three salespeople earning $60,000 gross each annually would receive bonuses of $18,000 per year. That’s money toward a new home, a child’s education, or a new car. One third of this would cover a typical health insurance cost of $600 a month for a family and this is precisely what real estate salespeople are looking for. They need it and they want it." Bonnell conducts training meetings regularly while overseeing the sale of the remaining available regions. To date, regional opportunities at Exit are still available in Montana, Wyoming, North Dakota, Nebraska, Minnesota, Iowa, Wisconsin, Illinois, Indiana, Tennessee and Louisiana. Exit divides up regions by state and franchises are sold within each region. Each franchise encompasses a territory that has been prearranged by the regional owner. The number of offices to be operated in each territory is determined by the franchisee. Exit franchises are five-year renewable contracts. "One of the most serious problems in real estate today is the obvious lack of effective teaching, training and coaching," says Morris. "Most brokers running offices lack the kind of pass-me-down wisdom necessary that really makes the difference when in comes to getting the most and the best out of each individual." Morris is a staunch believer in the necessity of constant learning, good work habits and the utilization of effective strategy; he originated Power Selling 101. This training program is based on total immersion learning designed purposefully to eliminate all inhibitions of dealing effectively with strangers. "All of our instructors have earned over $500,000 a year doing what they teach our salespeople to do," says Morris. "This is true apprenticeship. You get to fly under the wing of an absolute expert with on-the-job training." Morris believes that each brokerage operation deserves backup. His vice-president of operations, Erika Gileo, is one of the most experienced administrative experts in real estate, he says. Gileo has put together a team of highly trained franchise support people that is second to none. They are available 12 hours a day at Exit headquarters. This is one of the key reasons why Exit franchise sales have skyrocketed. To add to this Morris travels into each state on a regular basis personally to make a presentation he calls "60 Minutes with Exit." Groups of 125 people per session assemble to experience an on-stage sales talk on the history of the industry. "The results have been phenomenal," Morris says. "I do this every Tuesday, Wednesday and Thursday somewhere in the country and we are selling franchises like hot cakes and hiring salespeople like wildfire." Paron gives a similar presentation throughout Canada and many regional owners are now beginning to do the same thing. "The objective," says Morris, "is to generate on-stage group presentations of Exit in each region twice a month." Agents Are Assets, Not Pawns The main criteria behind the Exit philosophy is that the agents are the assets of the corporation. They generate all the front line money that pays all the bills and creates all future profits. With this perspective, everything is designed to enhance individual performance through effective goal setting, self-image reinforcement, knowledge and strategy enhancement, as well as empathy based psychological support. "Each person throughout this organization is of high value," says Morris. "When we hire them, we intend to keep them forever. Real estate is a people business and we specialize in this." In Focus: Agent Growth Exit’s bottom line objective is 3,200 franchises open and profitable across North America. If each one of their people sponsors in one more person per year their agent counts will exceed 128,000 by the year 2007. With this new three-dimensional format of taking listings, making sales and sponsoring, these idealistic goals can be achieved. "In the world of mergers and acquisitions where salespeople are treated like pawns in a chess game, this new philosophy is refreshing," Morris adds. Exit provides a triple-win situation. Both the broker and the salesperson win because of single level residuals. A future is now available to both groups that is unparalleled throughout the entire industry. But, the customer wins too because they have better trained, more financially secure real estate salespeople who can deal more effectively with them in a more service-oriented way. "Every Exit sign you see above a door is a reminder that our corporation is a calling," says Morris. "For Tami Bonnell, it was destiny."