The number one thing real estate business principals are asking me at the moment is the question of offering equity to key team members as part of a succession or retention strategy [or just to help them tick the boxes of what they want to do with their lives].
Whether it is a minor or more significant equity interest, you are really talking about whether you want to go into business together or not.
Going into business with someone can be a great thing, and it often leads to success. But, just like any relationship, it needs to be the right fit.
You want to do all you can to avoid the alternative.
When I talk to business owners about going into business together, I use an exercise that international business coach and speaker, Jacob Aldridge first introduced to me.
The aim of the exercise is to identify the drivers of why you want to go into business in the first place.
In my experience, there are five key drivers:
- Income – chasing more income [such as a higher commission percentage]
- Equity – chasing more equity [such as a stake in the rent roll]
- Control – chasing more influence on the decisions made around the place [such as not wanting to have to ask permission]
- Passion – wanting to pursue a particular passion [such as wanting to push a particular way of thinking]
- Choice – wanting more life balance or choice in where your time is spent [such as, will I do open homes on Saturday or will someone else do it for me?]
To continue reading more the business partner balance head over to the Elite Agent website.
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