Revenue Share Wars

If you are a real estate agent who has not been living under a rock for the past eight years you have encountered the revenue share promise.

‍Keep an open mind, get off the hamster wheel, and let me show you how you can earn more for doing the same thing. We are the new XYZ that is going to change the industry forever.

‍It’s a pretty sexy proposition especially if you were to catch an agent in a moment when they were questioning their life choices in the midst of a nightmare transaction or nightmare interaction with their current brokerage. It’s a seed of hope you plant knowing that nearly all agents will contemplate the conversation again at some future time.

Revenue Share is the concept of a Brokerage sharing transactional and other revenue with its agents. So in theory, the more agents you bring in and the more agents your agents bring in, the larger your Revenue Share will be each month. The common model now is multi-tiered where you get paid different percentages based on closed transactions and where the transacting agent exists within the tiers of the model. It is quite a beautiful concept if you can keep the pirates away but that is another article for the future.

So who started this (r)evolution? To be fair it is an evolution or iteration of models more than a real disruption. Netflix eliminated Blockbuster in a six year period. That is a disruption. Disruptions aren’t really seen while they happen, they just blind side nearly everyone and happen fairly fast. If anything, this revenue share iteration is loud, excitable, and at the end of the day can be a better choice for a lot of agents. I would argue the concept has not disrupted much of anything to date. If someone is claiming they are the disruption it is nearly certain to not be the disruption but that doesn’t mean all these revenue share models and newer revenue share models don’t add value and push for change in favor of the agent.

It was back in 1987 when the first form of this took flight. It was Gary Keller along with the first Keller Williams Agent Leadership Council that launched Profit Share. This was a huge concept and legend has it, it was almost a Revenue Share program. Regardless, Profit Share should be considered the foundation or starting point to today’s Revenue Share models. In its simplest form, these are mechanisms to allow agents to earn more and to monetize brokerage growth in terms of agent count.

Twenty two years later along came eXp and Glenn Sanford who came from Keller Williams where he was both a team member and eventual team leader. If nothing else, eXp needs the recognition for the model that cut its teeth on Revenue Share amongst other big model changes that added to an agents value stack. Whether you love, hate, or are indifferent to eXp Realty, it is the company that proved out the Revenue Share concept. Although it took quite a few years from its founding in 2009 to 2014 to reach the first 600 agents, the explosive growth kicked in soon after.

For years eXp Realty took the model on the road with a hyper excitable base of champions. All the while, pushing back on the fear and uncertainty other models and industry leaders were placing on its shoulders. The accusations ranged from it being some kind of Ponzi scheme to being unsustainable, the push to slow down eXp was significant. It was to the point where Gary Keller on a large stage said eXp had two years before it was going to have its going out of business sale half a decade ago.

I am unsure what the proper amount of time is before the unsustainability fear narrative should be put to bed. It seems that it has proved itself to the point where as agents, we now have choice when it comes to what Revenue Share model you want to hang your license.

It is March of 2024 today and because of the timeline above agents now have many models that have Revenue Share anchored deep in its value proposition. Real was the first brokerage to enter the Revenue Share space with any kind of force after eXp Realty and was founded in 2014 by Tamir Poleg. Although LPT Realty was founded in 2004 by Robert Palmer, it didn’t start gaining traction on the Revenue Share model until around 2022. Epique was founded in 2021 by Joshua Miller and started making noise in the industry in late 2022 shortly after LPT. The newest brokerage in the field is ENRG Realty founded by Erinn Nobel and Peter Nobel in 2024 and who were both in leadership roles within eXp Realty and Real.

Arguing what is the best Revenue Share model is like arguing what is the best flavor of ice cream. It’s personal and there simply exists no real best model for most.

Given this, there are two trigger words/phrases I want to warn anyone about when they hear them. They are the term disrupted and the term fastest growing. Both of these terms have no value when it comes to the value a brokerage can add to you as an agent. None of the models are disrupting the industry and being the current fastest growing company is more related to model acceptance than the true value added. Brokerages that launch today will grow faster than the brokerages that were introducing the concept. It is in a state of acceptance now and fear, uncertainty, and doubt that used to cloud the concept is lifting. There is also always that urge to be an early adopter or to get in near the ground floor. The fact that the model is in an acceptance stage means more and more people are open to moving to a new place to gain ground floor perceived value. So eXp did grow at a faster rate as some point to KW just like LPT can show that their rate of growth has beat eXp and eventually another company will show up and beat LPT’s rate of growth in some snapshot of time.

The one thing I have learned and feel nearly certain about is that if you pick a model with the idea that you will get rich, especially quick from recruiting agents, you are in for a tough few years. Look at all the models independently. They all explain everything openly. Then interview some people at all the brokerages on your list. Then pick the one that aligns most with your values and life goals. If you start your journey of finding a brokerage by talking to an agent that attracts, more often than not you are going to get a filtered view of your choices. Do some due diligence, make a short list, then reach out to people. It is your business and transitioning companies shouldn’t be taken lightly and you should be showing up to the table with significant knowledge of your choices before someone can influence or alter anything under their lens.

In the end it is still about transacting real estate and all Brokerages have figured out how to do that. Revenue Share is here to stay and there will always be a next Brokerage that offers a lower monthly, a lower cap, a higher revenue share payout, and more tools.

As a disclaimer, I am not writing about every Revenue Share model in existence nor am I advocating for any single model. It is up for you to decide if a Revenue Share model works for you.