- Worth Clark Realty president and founder Bryan Bowles brings his grandfather's legacy into his company values.
- The brokerage offers a 100/0 split, tech support and a negotiable commission structure with sellers.
- The company founder believes the real estate transaction should be far more transparent than it currently is.
- He also anticipates that more of the real estate transaction will go online in the next 10 years.
Underneath the business moniker “Worth Clark Realty” lies a philosophy blending blood, integrity and perseverance.
These family values passed on through generations helped company founder and president Bryan Bowles break the top 100 on the 2015 Inc. 500 list of fastest-growing private companies in the nation. Coming in at No. 89, the real estate firm experienced 3,493-percent growth in three years.
In addition to this marked expansion, the brokerage’s negotiable seller commissions, 100/0 splits, emphasis on the consumer experience and desire to break down opaque walls in the transaction process make it stand out as a rising player in the untraditional real estate realm.
Named after Bowles’ late grandfather, the St. Charles, Missouri-based brokerage honors the man who served as a significant role model for Bowles’ family.
Far from a business tycoon, Worth Clark had no ties to real estate. Rather, after his time in the military came to a close, he became a butcher.
Clark’s highly esteemed approach toward his job “made people feel good,” say the people who knew him best, because he genuinely cared about the community.
Though Bowles never met him, anecdotes like this from others who did have profoundly impacted his values as an entrepreneur.
“We innovate by approaching our job like my grandfather approached his,” Bowles wrote in a blog post on the brokerage’s website.
“We don’t cut corners. We don’t put our fingers on the scale. We believe in doing honest work and in being transparent in what we do.”
Moments of truth
A couple of defining moments in Bowles’ life led him to start his own firm in the industry.
The first — a wrestling injury (three broken vertebrae in his neck) for the high school state champion wrestler — squashed his college-competition and Olympic dreams.
Later, Bowles found himself holding down two jobs (one as a real estate agent, the other as an equities trader for Scottrade) and decided that, with a young family to think of, it was time to make the leap one way or another.
“I genuinely have an interest in real estate and like the control aspect of the tangible asset over securities,” he said. “I also see a lot of room for improvement in the industry.”
The barriers to entry, capital requirements and the number of savvy competitors were far lower in real estate than the financial services industry, too, he added.
After seeking a company that would allow him to offer different packages (full service buyer/seller representation, customized listing services and property management) while setting his own commission rates — and failing to find one that met his needs — Bowles founded WCR in 2009.
Despite the inevitable growing pains that accompany a one-person company in its infancy, he seems to have made the right choice.
In 2015, his brokerage did over $115.91 million in sales volume (694 transactions from 156 agent/brokers and three offices). The company’s revenue is about 50/50 property management versus sales.
At the moment, the tech-forward company has nearly 200 licensed salespeople, 19 account executives and 18 office staff and management.
The business operates in three main markets: St. Louis, Kansas City and Southwest Illinois. Meanwhile, Bowles is planning on opening in Denver, Nashville and Oklahoma City by the end of 2017.
Business model: ‘not a discount brokerage’
WCR is a full-service brokerage where agents keep 100 percent of their commission and pay the brokerage a fee on a per-transaction basis.
The transaction fee is a flat $395 for sales and $75 for leases, a cost that agents can pass onto clients if they so choose, Bowles said, adding that the company has no plans of ever increasing that charge.
“We do not believe in splits, unless we provided a lead,” Bowles said.
The founder’s reasoning is that sales agents find the majority of leads. The top-down approach, in which a broker assigns leads to sales agents, is “old-school,” Bowles said.
The brokerage website pledges that “if you can prove you earn more with your current broker, then we’ll guarantee to beat it.”
There are no tech, desk or legal fees, and WCR allows interested agents to compare their current earnings with what they’d pay at WCR with an online commission calculator.
At WCR, the commission paid by the seller is negotiable and customized for every sale after performing a needs analysis with the client.
The average listing commission the brokerage charges is roughly 5.18 percent, and for leases, it’s about one month’s rent. When representing a buyer, agents typically accept what the listing broker is offering — an average of 2.58 percent.
Bowles says WCR doesn’t fall into the “discount brokerage” category because the consumer is not getting much of a discount, he argues.
“A company should not be considered a discount brokerage based on their agent compensation model — it should be based on the prices it charges to the customer,” Bowles added.
Need for more transparency in the market
In a 2015 Gallup poll on public perception of honesty and ethics among professionals, real estate agents landed a score of 20 out of 100, below lawyers and bankers.
In that vein, Bowles’ overarching business strategy entails looking at what’s next for the industry and what will better serve the modern customer.
“Many brokerages focus on splits and what it can do for agents, when what we prefer to focus on is taking care of the customer’s needs — and the biggest thing we see right now is shedding more light on the process and transaction,” he said.
Bowles would like to rid the industry of real estate deals in which agents are only presenting certain favored bids to sellers.
He is intrigued by Haus.com, a platform that digitizes the offer submission and acceptance process, developed by Uber co-founder Garrett Camp.
Currently limited to California, Haus allows buyers and their agents to post their offers online in an open forum and see what others have also offered anonymously.
Its launch (in July) stirred up controversy, with some industry professionals concerned about unqualified buyers, artificial inflation and the implications of full disclosure.
“I’m not sure how quickly something like this will be adopted by the industry, but it’s a step in the right direction, in my opinion,” Bowles said. “It seems so much of the conversation in our industry is focused on agent splits, and tools to improve agents’ jobs, but very little is about improving the actual customer-experience.”
Bowles has also looked closely at Ten-X, the residential online auction platform, yet to come to his market.
“Ten-X.com and Haus.com are two new systems that offer a lot of online transparency. I believe systems like these will pave the way to what our industry will look like in 10 years from now,” he said.
The state of Worth Clark tech now and moving forward
While these two platforms serve as part of Bowles’ tech ideology, the company is in the throes of building up its own tech team.
Currently, much of this division is contracted out to third parties at WCR, though agents have tech support seven days a week and, if it’s after 5 p.m., can call, text or email WCR for help, according to the brokerage’s website.
Moreover, WCR agents get access to a transaction management system, marketing center, CRM, Realtor.com Showcase account, IDX enabled website, single property sites, mobile sites, sign rider texting and webflyers.
“None of these really align with our future goals, which is why we’ve recently begun hiring to build out our own systems,” Bowles explains.
“For example, BackAgent is probably our favorite of all of these; however, it doesn’t really align with our mission to improve the transparency and front-to-back customer experience we’d like to provide to the public.”
He notes that “there’s no solution for all the stages of a home sale or lease — from the website to the property search (IDX), to CRM, to offer management, to electronic signing, to transaction management, to closing — which is why we’re creating it ourselves, for ourselves.”
Tech products in real estate are often bells and whistles for agents rather than consumer-facing, he added. That’s why the firm is looking to replace third-party tech solutions.
“We can create good things out of own frustrations,” he said.
Taking a stance on affiliated services
With his background in the financial services industry, Bowles applies a lot of the same conservative measures, he said.
He doesn’t think there is anything wrong with owning title companies or division, but these relationships have to be disclosed. And agents shouldn’t be incentivized for recommending them.
“Back room deals are a big no-no, and this is still a lingering problem in the real estate industry,” he said.
“I still see many home warranty companies paying agents directly, side-stepping the broker, for referring business.
“It’s only a matter of time before the CFPB [Consumer Financial Protection Bureau] does something about it.”
Giving lead generation its own team
Meanwhile, company founder says he’s doing things his way. Though he left his equities trading behind him, Bowles has brought with him a lot of the lessons he learned in his financial markets career.
“I don’t network too much with other real estate brokerages,” he said. “Doing so, in my opinion, would only cause me to get too tied to the way things are rather than thinking outside the box.”
As such, he has account executives (trained salespeople) committed to fielding all lead types the company generates — sales, leasing and property management.
They’re tasked with delivering the company’s brand and mission while providing strong customer service.
Agent training and mentoring
Although the entrepreneur sees consumers as his clients, he knows his success relies on attracting quality sales agents. And this includes new agents.
Therefore, if new licensees meet the minimum WCR requirements, they’ll be paired with a more experienced agent who will be their mentor for the first three transactions.
This one-on-one, experienced-based learning is more effective than placing someone new in a class, Bowles said.
Agents who come onboard, he added, do so for the support and the additional services they can provide to the public.
“Many like the idea of keeping all their property management and leasing business, or referrals … under one roof,” Bowles said. “And most reach out to us after working a deal with one of our agents and hearing about the availability and support of our office staff.”
The company president has plans to be in 20 total markets within the next five years.
Worth Clark has a scoring system to help decide where to set up next, he said:
“We look at a market from the aspect of the number of active sales and lease listings, the number of non-owner occupied homes, the number of properties sold, the number of active Realtors in the market and the number of brokerages.”
Although he can’t be persuaded to predict how his 2016 will finish — forecasts are so often wrong, he said — he is more than happy to look into the real estate’s long-term crystal ball.
What does he see? All signs point to digital, so Bowles anticipates that technology will become an increasingly important part of the process, over time replacing the transaction’s most repetitive motions.
But he can’t envision a robot navigating all the variables, nuances and emotions that only an experienced professional can understand.
“I don’t think it’s very difficult for sellers to find a buyer,” he said. “What’s difficult is navigating through escrow, managing expectations and emotions.
“I think most real estate agents either fall in the category of a facilitator or a counselor.
“Over time, the facilitators will be replaced by technology, but being a counselor is what sets the good agents apart.”