Partnerships That Lack Purpose: Why Most Real Estate Partnerships Don’t Last More Than 6 Months
As a Broker/Owner of a company of 100 plus agents and a Real Estate Coach, I am often approached by many people indicating that they plan to “partner up” with another agent. Reasons to do this vary from sharing marketing dollars to “spotting” each other while one takes vacation. While there is a definite appeal to having a partner in an industry that can be very lonely at times, there are specific reasons that most Real Estate partnerships fail.
In my own experience I have been fortunate to create and sustain a long lasting Business partnership with a close friend and colleague. Our partnership originated after a combined 20 plus years of selling experience and transitioned into determining that we wanted to own and grow a successful Real Estate company.
The partnership has faced it’s challenges but overall it has been the best experience I’ve had inside of my career and it continues to evolve in a positive direction. A constant awareness has been crucial in maintaining our friendship inside of the growing model we have created.
Most partnerships often dissolve due to challenges that stem from many reasons and various circumstances. The list is long and ranges from contribution and commitment to ego based problems and profit responsibilities. In my experience the number one reason that most partnerships fail is a pure result based mindset by one or both partners involved.
Here are 5 specific principles to understand and evaluate when you are considering a Real Estate partnership:
- Understanding Your Joint Vision
There are no two people who are exactly the same. Although you may have the same ideas as far as goals, money will not be the driving factor of a successful Real Estate partnership. Have you clearly identified your purpose as individuals and how that can be matched up to create a purpose of a business partnership? We call these “Life Goals”.
2. Embrace Your Strengths and Weaknesses
If you are fortunate to discover that each of you will bring various skill sets to the business relationship, you will ensure that you focus on the positive aspects of each other versus the negative. My recommendation is to be abundant in your own individual skill sets and recognize the other for doing the same.
3. Know Your Numbers
Whether it’s selling or recruiting, understanding your numbers and tracking everything is a science that I encourage. Reverse engineer all of your results and outcomes to create a process that is measurable and sustainable. This applies to sales and conversion rates along with recruiting and attrition rates. When you focus on the activity and process that is required to meet your goals together, you will then be able to find success through new systems and improvements.
4. Have Predetermined Expectations
No partnership will exhibit the same productivity result per partner however this is where most partnerships meet their demise. Consider creating an agreement to a minimal level of commitment required to income generating activities. With an understanding or knowing that you both are contributing at the highest level, you will soon eliminate the idea that one of you is doing more than the other.
5. Make It More Than Just Business
Real Estate is a personal relationship business. Your Real Estate partnership should be and will become one of a personal nature as well. Learn to understand what fuels your partner and what they truly value inside and outside of the business. A partnership is just as much about quality of life inside of Real Estate as it is selling more homes or recruiting more agents. Developing an understanding of one another on a deep personal level will serve your partnership at the highest level.
A Real Estate partnership like any business partnership can be both very rewarding and very frustrating. The challenges that most relationships of this nature face will always present themselves however with the right level of awareness and a commitment to serving yourselves and others, you may find success inside of the Partnership model and develop a life long friendship through the process.