Updated: Aug 19
Have you ever wondered how the number one real estate teams in the world operate, or how they got to be at the top? If they told you their secret, would you be willing to change your mindset and put their business model into action? Ladies if you are looking to scale your business or exit production ever… at anytime now or in the future … then this is the episode for you! We are talking to Alana Badeaux VP of Operations with The Loken Group the #1 Keller Williams Team in the World.
On this episode of the Agent Exit Podcast, we focus our discussion on the Loken Group’s operations model which allows rainmakers to exit production. Learn how Transaction Coordinators (TC's) and Inside Sales Agents (ISA's) can have a powerful impact on your growth. Listen closely for a key way the Loken Group is giving back that just might be beneficial to your business.
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Resources - www.TLGShares.com
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How To Build A Mega Team And Exit Production With Alana Badeaux & The Loken Group
Before we start, a quick word from our sponsor, Realbie. Realbie is a strange little word with a big impact for your business. What is Realbie? Realbie is part of the Renee Williams Group family of brands for experienced women real estate professionals aged 50-plus. Realbie is a hands-on consulting part of our business, here to help you with operations and strategic retirement planning. That means if you need help with operations, systems, people management, financial well-being and retirement planning, we're here to help you get out of overwhelm and get it done.
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Have you ever wondered how the number one real estate teams in the world operate or how they got to be at the top? If they told you their secret, would you be willing to change your mindset and put their business model into action in your business? If you're looking to scale your business or exit production ever, at any time, now or in the future, then this is the episode for you. We are talking to Alana Badeaux, VP of Operations with The Loken Group, the number one Keller Williams Team in the world. Here's some background info on this rockstar team if you haven’t heard them already. The Loken Group started as a two-person team with Karina and her husband, Lance Loken, in 2011.
The Loken Group is the number one non-expansion Keller Williams Team worldwide based on units and volume in 2020. They are the number one large team in Houston according to The Houston Business Journal and the number one large team nationally according to Real Trends and The Wall Street Journal. They have been named the number one Best Place to Work in my city, in Houston, several times and they are doing all of this from one location.
We are going to be talking to Alana Badeaux. Alana has been with The Loken Group for years and serves as Vice President of Operations. She is responsible for coaching and training the administrative staff and the creation and implementation of systems and process excellence. We are going to focus our discussion on The Loken Group’s operations model, which allows rainmakers to exit production. We are going to talk about transaction coordinators, TCs, insight sales agents, ISAs and outside sales agents. Read closely about the compensation model, how they are hiring and some key ways that they are giving back that might be super beneficial to your business. Are you ready? Let’s get into it with Alana Badeaux, VP of Operations from The Loken Group.
Welcome to the show. With me is Alana Badeaux. I want to say hello to Alana. She is with The Loken Group. To give a little bit of background on how I met her. I first saw Alana when she was teaching or doing a training at a conference. It was 2019 at the KW Mega Camp. I was the Director of Operations at that time for a Top Producing Luxury Team at Keller Williams in the Woodlands. I was a super fan right off the bat, all the great information she was providing to the Director of Operations Class. After that, I had the privilege of training with Korina Loken at their office. Korina was doing Career Visioning, which is a Keller Williams Program. I learned so much from these ladies. I had to come and share with the audience. Alana, welcome to the show.
Thank you, Renee. I've never had a super fan. I'm so excited.
Thank you. Can you tell us about you, your role and The Loken Group?
I've been on the team for years. I'm what we call the OGs from back in the day. I was the tenth hire and now we have about 96 team members. In the years I've been here, we have experienced some massive growth, which is awesome. It comes with a whole lot of systems and processes along the way. I started out with the team. We didn't have an ISA department at the time. I was answering all of the incoming phone calls and was responsible for routing them, where they needed to go. We had one burgeoning new construction builder account. At the time, I was responsible for managing those listings, but it was primarily front desk type of receptionists' responsibilities. Over the next couple of years, we moved into listing coordination for our resale listings, then contract to close for our resale listings.
People have different needs at different points in their life.
At one point, we had an amazing listing agent on our team named Britney. Her goal was to close 200 listings in one year. She was not going to stop until that happened. We ended up pairing off one-on-one together and I handled all of her listings from agreement signed to close. It worked out so well. We scaled that model across our whole business. That's how we have everything set up, which has been going well for us, both from a communication perspective, as well as a client experience perspective. I'm in the VP of Ops role. My primary responsibilities are coaching and training our administrative staff, as well as systems and processes, creation and implementation. I'm constantly looking for gaps in the business and things that we could be doing differently or better to serve both our clients internally and externally. Then figuring out how to fill those gaps. It's not sexy to a whole lot of people.
It is sexy to me.
It’s what makes the engine run. It's one of those necessary things.
I love operations. It is the engine. It is the motor to your business. You can't run it without it. People love sales. They love marketing. That's all pretty and sexy and everybody wants to get on a video and be in front of everybody. At the end of the day, your systems, processes, operations are what make your business go and grow. It's not about sales. I have so much respect for you and for what you do. As far as the company is concerned, you guys have a beautiful beginning, middle and where you are right now. How did you start? Can you tell us how you have evolved to where you are now?
I might be jumping ahead a little bit. I wanted to mention TLGShares.com. It's a website that we host tons of materials. The reason I bring that up now is we share that with everybody and it's free. All you have to do is log in with your email address and you have access to all of these resources. One of those things is our Org Chart all the way back from when we first started out. You can see visually the progression of what our team has come through back from 2011 all the way to now.
I've seen it. It's phenomenal to watch the growth.
Lance is a freak of nature. He likes having his org chart planned out for the next ten years. He always has. It's a cool resource if you want to see it. I think we speak to a lot of people where we're at in our business now and they go, "It's like drinking from a fire hose. You have so much. We're a small one or two-person team. We're just getting started.” That's okay. We were there once too. It’s interesting to see that progression. I'm glad you asked the question.
Lance and Korina, they started the team together. Back in 2011, they’re a husband and wife team. Their first hire was their babysitter. I'm sure a lot of agents starting out. They didn't have a lot of cash on hand. They were staring their business and they quickly learned like, “We're not paperwork people. We're not the dot all the i's and cross all the t's people. We need to leverage that out to someone.” The first person they hired was on a part-time basis. It was their babysitter. They paid her like $100 a week. It was what they could afford. She took care of their compliance and their documentation and things like that. The next hire that they brought on was a full-time TC. She's still with our team. She is amazing. She's had several different roles over the years as well.
TC is Transaction Coordinator. Sometimes we have new audiences. Most of our audience is very experienced, but I like to explain in case.
That's perfect. Sometimes I take for granted that not everybody knows all the lingo all the time. I appreciate that. We hired a buyer agent. The Loken’s weren't following the millionaire real estate agent model at the time. They first thought like, "We're going to work with buyers.” It wasn't until the 2nd or 3rd year in business where they’re like, "We probably get some listings because leads listings leverage.” I would say, "They got a buyer's agent." As the business scaled, we were doing some part-time.
We hired out marketing for twenty hours a week. Everything happened organically as the need arose. I think we sometimes fall into this trap of, "I have to have a full-time person by this time.” Thinking about what would have to happen in the business to merit bringing that person on. Of course, holding those roles and those dollars to afford a one ROI, like you would any other marketing dollar in the business. It was about probably our fifth year in business that we started our ISA department.
We brought in our first ISA. She was basically outbounding, doing all the cold calling. She was on a strictly commission basis. That's how we afforded that at the time. We gave our agents lots of leverage because they were taking down leads and Post-it's in their car and throwing it in the backseat and never talking to them again. We recognized that was an important element to our business. We've never stopped growing from there. That's how we grew.
For everybody that's reading, the secret sauce for the team is the ISA. I don't know, Alana, if you agree with me on that but that is how you put rocket fuel into the tank of your business. By having someone who is based on commission. You're not spending a whole lot of money on this person. They are incentivized to do well. ISA is an assistant. If you're a smaller agent, you don't have a large team. That's the way to go to the next level. Do you think so, Alana?
I 100% agree. I think there are a couple of elements to that. One, we started out on a strictly commission structure for our ISA. We have since moved to a base plus commission, which works for us. There are different models out there that you can test out for your particular business but I agree with you. In general, for our great agents, they are not naturally great at follow-up. They'd much rather be face-to-face with people. They would much rather be building those relationships. That's where their strength zone is. Whereas if you're hiring someone specifically for this ISA role, the fortune is in the follow-up, as the saying goes. Their sole job is to pound the phones, manage those incoming leads, route them accordingly, set you up on your appointments. They're doing that behind-the-scenes work. The question we get a lot is like, "How do you hire that person? Who wants to do that all day?” I know you're not in your head.
That's the question. It's hard to believe that somebody has a personality that's different from mine that would rather sit and pound the phones than get out in front of people and talk. For that, it's a paradigm shift in your mind to understand that there are different types of people. Everybody’s not like me.
People have different needs at different points in their life. Some of our ISAs originally thought, "I might like to be an outside agent eventually,” then, they had a baby and they need their nights and weekends back to themselves. We might've had somebody who was an outside agent and said, “My priorities have shifted a little bit. I'd like to not work every weekend.” ISA lead gen is more for them. Some people are unicorns and they love it. They love being on the phone and making those connections. They are not afraid of hearing no. They're super gritty and they'll go until they get a yes.
I'm referring back to TLG Shares because that's where you can get the description, is that right? You have so much. You have a wealth of information. I'm trying to remember all the stuff that you all have there. There’s so much.
It’s all the things. We have, I believe, all of the job descriptions. What's great is we get requested a lot is our Hundred-Day Training program for our ISA department. You can go rip off and duplicate how we're training our ISAs to perform at the top level.
While we're on the topic of staff positions and roles, can we talk a little bit about the org chart and what the titles are for the positions? If there's a way to curtail that to maybe stay within sales-focused because I know that you may have different departments that do different things. Share as much of that as you'd like to.
I will do my best to keep it as relevant as possible. To start out, we do have a full marketing department in-house. It started out with one person. It's grown. If you're going to look at our org chart, you're going to see that. That's not typical. I don't want to make anybody feel like that's necessary. There are amazing freelance marketing people out there who can help you with that. With that said, on the production side of the business, we have the ISA department, which the bedrock of what we do. They are churning and burning leads all day, every day. Our outside producers do not do lead gen at all. That is the ISA’s role.
The outside producer’s role is to go on appointments, convert to a signed agreement. We get them under contract, then we get them to the closing table. We have buyer agents and we have listing agents. We don't mix those in general. Every now and then, we'll crisscross. For our business, we found that a certain personality style does well as a listing agent. A certain personality style does well as a buyer's agent. They're two very different transactions. You'll see that on our org chart. In our operations department, we have, of course, your standard buyer transaction coordinators, your listing transaction coordinators and we have some photographers on staff as well. That's the high-level view of what our org chart looks like.
It's all about the value. Price is only an issue in the absence of value.
For those positions, Keller Williams has a specific program that I know that Korina is an expert in. As far as interviewing career visioning, how to select the right people, can you give us a snippet or a general overview of what does that look like? Often, it's hard to pick the right people to put in the right seat on the bus.
It's a good question because something that we get a lot is, "How do you know you're hiring the right person? How do I avoid turnover? How do I grow my team rapidly, but also successfully?" Keller Williams has put together this incredible program called Career Visioning. It's about a 7 or 8-step process, which feels daunting. Sometimes it can take 6 to 8 weeks for a candidate to go all the way through this program. What I will tell you is our attrition rate is low. By the time we've spent that much time with a person, we know that this business partnership is going to be as much a benefit to them as it is to us. That's important. We are vetting out their natural tendencies. The way they want to be led. What's their experience like? Where do they want to go in the future? That's one of my favorite interviews to do with potential candidates. That’s what we call the motivation interview.
We're talking to them about, “Tell me about what your life looks like five years from now. Tell me what would make that awesome? What does that look like for you?” We want to understand what motivates this person and our business can grow to the point that would encompass their goals as well because it's not always about us. It's never about us, if we're being honest. One of the other big parts of CV or career visioning that I think a lot of other hiring processes overlook is what we call the culture interview or the group interview, where they get an opportunity to meet with multiple members of the team.
If you're a small team, maybe that means both of you or all three of you and you go to lunch. You're vetting out, "Does this person fit with our mission, vision and values?” We found that 90% of the people who have deselected themselves from our team. When we look back on it, it was a values mismatch. By digging into those, we are much more likely to hire people who fit our core values of a gritty, solution-based, team player, servant leader. We've got to be clear about those elements and we hire people that are like us.
You are masters at this. As far as the compensation is concerned, does that play a large role in a candidate’s selection or candidate’s decision to stay with you, guys? Do you have a specific compensation model that you use for each role?
We are very intentional. Lance is a former CFO. He has the financials wrapped around his finger. You will never pry it from his hands, the financial piece of our business. He's very serious about it. He has three very large screens in his office and they're covered in Excel spreadsheets at all times. What he's looking at is the profit margin. We want to make sure that we can continue to stay in business. We pour a large portion of our profit back into the business so that we can continue growing not just a business but also the people within it.
We're looking at on each deal, we want to have at least or no more than 50% being paid out in commissions. Typically, our ISAs make 10% on every closing that they were the procuring cause of the lead. Our listing agents make 15%. Our buyer's agents make 35%, unless they have additional leverage then it changes a little bit. That's also factoring in the salaries of the transaction staff. Lance has been very intentional with his pay structure. I think a lot of people probably hear 10%, 15%, 35%. How do you keep people? It's because we have built our business that it benefits them to take a lower split. They can make more at the end of the year because we're keeping them in their strength zone.
I remember our buyer's agent. He used to be on a 50% split. When we first started the ISA department, Lance came to Sarah, who is now our VP of Buyer's Agent and said, “If you never had to lead gen again,” and I don't even think she heard him after that. She was like, “Whatever it is, the answer is yes, I'm in.” When he said, "If I can show you how you can make more money by taking a commission split because I'm bringing on an ISA, how open would you be to experiencing that?” She was like, “I'm in. You got me.” It's all about the value. One of my favorite sayings is price is only an issue in the absence of value. If your agent is saying, “Split’s too low. I'm ready to leave because I need more money,” then we haven't provided enough value for why our split is that percentage.
For everybody who's reading whose mind is blown by these splits, let's talk volume. Can you give me an overall sense of what your volume was for 2020?
For the team as a whole, we closed around 2,500 units. Our listing agents, in general, close between 100 to 120 deals a year. Our top producing agents can close up to 200 deals a year. Our buyer's agents, they average between 60 and 80 deals a year. Usually, it's somewhere between 4 and 8 closings per month. We're doing a high volume. They're so leveraged efficiently that they can stay in their strength zone and still make money.
I wanted to point that out because for those who are reading, you understand the splits don't matter because the volume is there. The way that the entire operation, the systems, the processes all contribute to everyone being in this synchronized dance of this great operations machine that you have going. The splits don't matter. If the agents are looking for more money, you're adding value, long s