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For years, entrepreneurs and venture capitalists have wagered against the traditional real estate brokerage model and now, in this heated market, we see another round of formidable entrants into the real estate space.

To victor in this space ensures impressive financial rewards, but for most will come a failed model with causalities cluttering the landscape. This begs the question: How is it that such a “broken” business model can endure such outside force and pressure to its perceived profits? How can millions of venture capital dollars not infiltrate the consumer perception and potentially even past negative experiences lived out in past real estate transactions? How can the consumer not want to potentially save hundreds or even thousands of their hard earned dollars?

To an outsider, the answers seem simple. That is why so many savvy investors and venture capital companies begin “disrupting” the real estate industry by attempting to divert the consumer from traditional Realtors to their online portals, discount business models, or their so-called innovative technology.

As an industry insider and executive at a large, thriving, full-service real estate brokerage, it’s hard to sound impartial considering we are in a hand-to-hand battle everyday to take back what we feel is rightfully ours; a consumer who is given the best service, advice and professional expertise available. 

Now don’t get me wrong-I know there are consumers, maybe some of you reading this article, who have had a poor real estate experience. I feel confident in saying that this is not the typical result that comes with hiring a qualified Realtor.

Getting back to the disruptive real estate business models, there is no denying that outwardly, they are appealing; they are systematized, efficient, processed driven, scalable, have a pleasant user interface, and are seemingly profitable. All the descriptors that bring music to the ears of serial entrepreneurs, like myself. However, the major problem is glaringly obvious once you take a closer look: These systems, processes and technologies are not built on relationships. Real estate and the complexities of the transactions (and there are many of those), require a sturdy relationship to create an experience that benefits the consumers.

The home buying and selling process cannot be (and should not be) commoditized like so many venture capitalists and entrepreneurs hope it can be to the drive those big profits and the almighty consumer dollar.

One of the primary reasons it cannot be commoditized is because just like every home, every negotiation is different. Negotiation and the art of negotiation cannot be systematized, standardized, or process driven- it needs people to work them, understand them, and professionally guide and coach their clients through the litigious gauntlet that has been created in the industry.

There is no denying that relationships are the basis of good sales. Show me the most successful Realtor in any given area and I’ll show you a person who knows how to create and maintain good relationships.

In the 23 years I’ve been in the real estate industry with thousands of agents I have coached or employed, I have never encountered an agent who maliciously took advantage of, undermined, or manipulated their client in order to benefit themselves and negatively affect their client. Agents get to know their clients, connect with their clients, and understand the needs of their clients. Systems, technology and processes cannot do that. Agents ultimately have a deep desire to serve, and at the end of the day, want recognition of a job well done (like most of us!). Ask yourselves, do these new disruptive models reflect a consumer-oriented way of doing business?

One of the great pleasures I have in my career is the opportunity my team and I have to raise the bar on the industry insiders- the agents, managers and executive teams of all our competitors in the market place. Our company, like many other fine real estate companies in the United States, strive everyday to make our agents better, smarter, faster, and more competent. We work hard to develop systems and technologies that serve to enhance their business and the services that they deliver to the consumer on a daily basis. For this reason, It is hard to imagine that traditional real estate is going anywhere.

Like many industries, there are sales people who engage and have the drive and passion to succeed and there are others who do not. Simple. Real estate is no different. As an industry, we need to do a better job in driving these individuals out whether it be more diligent internal standards, higher qualifications, education, or a better vetting process. This is something that will only benefit all traditional real estate companies- brokers, agents, and consumers alike.

Many industries face “disruption” with the advent of technologies that can easily replace our highly skilled and trained employees. If we strive to invest in our people, to enhance their systems, processes, and the technology that they use, the uphill battle seems less daunting, because at the end of the day, your battle can only be won by your soldiers.