Answering 2,000 agent questions a day: Inside The Real Brokerage playbook

HousingWire

Today on Power House, we have a crossover episode with the RealTrending podcast. Host Tracey Velt talks to Tamir Poleg, CEO of The Real Brokerage.  Tamir and Tracey talk about using AI to optimize daily operations, including the automation of thousands of inquiries with an AI assistant. He also talks about how Real scales without losing its culture, the shifting dynamics between agents and clients, and why brokerages must shift to a consumer-first mindset.   Here’s what you’ll learn:   Real is both a technology and a real estate company.  AI enhances operational efficiency and client service.  A strong company culture attracts like-minded agents.  Leadership will always involve taking responsibility for failures.  Automation can replace many tasks traditionally done by agents.  AI will play a significant role in decision-making for real estate transactions.   Related to this episode:   ⁠The Real Brokerage⁠⁠   Tamir Poleg - The Real Brokerage Inc | LinkedIn⁠⁠  https://www.linkedin.com/in/tamir-poleg-1b303429  Real Brokerage leverages agent count growth for soaring revenue | HousingWire⁠⁠  https://www.housingwire.com/articles/real-brokerage-q4-2024-earnings-call/  Best Real Estate Brokerages in United States | RealTrends Verified⁠  https://www.realtrends.com/ranking/best-real-estate-agents-united-states/brokerages-by-volume/?__hstc=44321979.3ad0991f82af19ed035ab5958380bad3.1737576277468.1746135106667.1746138550650.193&__hssc=44321979.5.1746138550650&__hsfp=3347877758   Enjoy the episode!   The Power House podcast brings the biggest names in housing to answer hard-hitting questions about industry trends, operational and growth strategy, and leadership. Join HousingWire president Diego Sanchez every Thursday morning for candid conversations with industry leaders to learn how they’re differentiating themselves from the competition. Hosted and produced by the HousingWire Content Studio.

Transcript

00:00This episode of Powerhouse was brought to you by our friends at Poly.

00:11Welcome to the Powerhouse podcast. Today's guest is Tamir Polig. He's the CEO of The Real Brokerage.

00:18They are ranked number six by transaction sides and number five by sales volume in The Real

00:24Trends Verified top brokerage rankings. Thanks, Tracy. Excited to be here.

00:28So we we've talked more in the last couple of weeks than I think in two years. So I'm really

00:34excited to talk to you again. And I wanted to dig in a little bit about some of the some of the topics

00:41that we talked about for the interview that I published on HousingWire. So you had said that

00:48Real is really focused on tech innovation. And I wanted to get into that. You know, what is that?

00:56And how do you define success with that?

01:01Um, I think that it goes back to why and how we founded the company. We started the company back

01:08in 2014. And I think that throughout the years, we always asked ourselves, are we a technology

01:14company or are we a real estate brokerage? And every time we would say, okay, we're a real estate

01:19company, but we're also a technology company or we're a technology company that operates a real

01:23brokerage. But I think that technology plays a role in different aspects. And I'll try to describe a

01:30few of them. It's no secret that this is a low margin industry. And the margins are shrinking for

01:36brokerages, which means that you have to become more and more efficient in your operations. You

01:41need to automate as much as possible, you need to be able to scale without adding more operating

01:46expenses, you need to leverage the existing human capital, but also the software that you're able

01:53to build in order to automate processes that will eliminate the need for human in the back office.

01:59So I think that from the very beginning, we were trying to focus on, instead of, for example,

02:05marketing, agent marketing, property marketing, we were trying to focus on efficiency,

02:11operating efficiencies. So we're trying to understand what are those tasks that are being handled by

02:16humans in the back office of a brokerage? And how can we replace those humans with software?

02:21So I'll give you just a couple of examples. A year and a half ago, we launched Leo, which is our

02:28AI assistant for agents. Leo currently answers 2,000 agent questions a day. So think about how many

02:33humans we would need in order to answer 2,000 agent questions. So that's number one. And this makes us

02:39extremely efficient. And we measure efficiency by the number of employees or full-time employees to

02:46agents. And that ratio is the best in the industry. And that is due to the fact that we are able to

02:52automate through software. So that's number one. Number two, another thing that we just recently

02:56launched is automated broker view. So as you know, that brokers have to review every file that agents

03:03sign with their clients. And in order to approve a file for payment, we need to verify that we have

03:08all of the documents in place. Everything is signed. All of the paragraphs are filled in. All of the

03:13boxes are checked. And typically, humans are doing it. And now we created an AI tool that knows how to

03:19look and read documents and immediately provide feedback to the agent saying, hey, you're missing

03:24a signature on page eight and you're missing the late paint disclosure. So instead of a human

03:30reading through hundreds or thousands of documents every month, we now have AI doing that. So what I'm

03:37trying to say is that AI is instrumental in our ability to continue and grow profitably and scale

03:44without adding operating expenses. At the same time, just 10 minutes ago, our tech team gave me a demo of

03:55what our AI is doing for clients. And this is a project that we've been working on. They stitched my

04:00voice. So they trained AI on my voice. And they recorded a conversation between a client that's

04:07looking for a two-bedroom home. And that client was talking to me. It was my AI, but it sounded like

04:16me. It had the same accent, the same way that I'm speaking. And it actually had a conversation with

04:21the client. So what we will be rolling out in a couple of months is an AI tool for agents that will

04:27enable them to switch it on and have conversations with their clients, trying to understand or better

04:32understand what they're looking for, what kind of homes they're interested in, what is important to

04:36them, what their financial situation is, collect all of the information that is required in order to

04:41jumpstart that process of finding homes. And then later on, also be there 24-7 in order to provide

04:48updates and just improve the level of service that our agents are able to provide to their clients.

04:54And again, it will feel and sound as if it's the actual agent that is speaking to them. Obviously,

05:01there will be a disclaimer and we will tell them that this is not the agent, this is the agent's AI.

05:05But we want to get to a point in which within a couple of quarters, our agents can have voice

05:13conversations and also video conversations speaking to their clients without them actually needing to

05:19to allocate the time to do so. So how do you, there will be detractors to that, you know, because real

05:27estate is a relationship business. So what do you have to say to people who, you know, probably

05:33competitors who say, well, this is a relationship business. We don't want AI talking to our clients.

05:40Oh, 100%. This is a relationship business. But at the same time, we have to understand that AI is

05:48probably bigger than all of us anticipate. And AI will change industries and AI will eliminate a lot

05:55of jobs. So it's not about whether real will be using or not using AI. I think that AI is a bigger

06:04threat to our industry. And unless we as the brokerage industry, and I urge all of my peers and the CEOs

06:10in the space to double down on AI, unless we invest in AI, in order to provide the tools for our agents

06:16to provide a better service to their clients, somebody else from the outside will be leveraging

06:22AI and will end up probably eliminating all of us. So I think that it's not about, you know, this is a

06:29personal business and based on relationships, it will continue to be so. But at the same time,

06:36you also have to try and break down what are those tasks that agents perform for their clients. And we

06:43came up with a list of 200 or 250 tasks that agents perform for buyers, for example. And we realized that

06:50about 90% of them can be automated or replaced by or enhanced by AI. So it's not about real or not real.

06:58It's about what consumers expect. And consumers expect you to be 24-7 on. They want immediate

07:05answers. They want very knowledgeable answers. They want a lot of information. And sometimes

07:10an individual cannot get to that level of service. Or I'll put it differently, an individual can be

07:19enhanced using AI in a way that is not scalable, just based on the human component. So if anyone is

07:28kind of second guessing what we're trying to do, we'll probably let the future decide.

07:33Yeah, absolutely. I mean, I think there's a lot of confusion around AI in the brokerage industry and

07:39with agents. They don't understand the true capabilities of it. And they, you know, they're using

07:47it maybe to write a listing description or, you know, what are they missing?

07:54I think that what's encouraging is that more and more agents are using AI. And yes, it starts with,

08:00you know, very basic tasks. Like, you know, please help me prepare a listing presentation or please

08:06help me draft an email response to that client. But those are just the, you know, the first steps to

08:13maybe more widespread use of AI. I think that we cannot expect agents to build the AI technology

08:21that they need. This is on the brokerages. We have the resources or we need to be the ones that

08:26provide them with those tools because sometimes they don't have the resources or they don't really

08:31know what they're missing or what they need to build. So, you know, as a company that allocates tens of

08:37millions of dollars a year into R&D and a lot of that is into AI research, I think that it's our job

08:44to equip our agents with that competitive advantage that is AI based. But I was on a panel over the

08:54weekend in a conference and agents asked me, what are we supposed to do now with AI? And I told that

09:03agent that as a first step, you have to train AI on who you are. So get your AI to know you.

09:13It doesn't matter which kind of AI tool you're using. Let's say you're using ChatGPT.

09:18Just start conversations with ChatGPT. It will help them help ChatGPT understand who you are,

09:27what you're doing, where you're coming from, what you're interested in. I have a friend who

09:33recently started dating a new girlfriend. And every time they had an argument or a misunderstanding or

09:41something was going wrong, he would go to ChatGPT and he would actually tell ChatGPT what was going

09:47on. And within a couple of weeks, ChatGPT was becoming so knowledgeable about their relationships

09:53and why is she reacting in a certain way and why did he tell her what he told her. And ChatGPT was

09:59actually able to analyze their relationship much better than each of them was able to. So right

10:05now, most of his responses to his girlfriend are coming from ChatGPT. What I'm trying to say is that

10:10there could be a point in time in the future where AI will actually be making the decisions for buyers

10:17and sellers on what to buy or how to sell or for how much to sell. And it could very well be that

10:24the buyer's AI will be making decisions with the seller's AI and the human component will be just

10:32there to create trust and make sure that the transaction moves along. But I think that it's

10:38not far-fetched to think that within 10 years, my AI will be talking to your AI or I'll put it

10:44differently. In a year from now, I bet you that this conversation can be done without me being

10:52physically present here. It will be my AI talking to you. You wouldn't feel a difference. It will

10:56provide the same answers. It will look like me. It will talk like me with the hands and all of that.

11:02So it's not 10 or 20 years out. We're talking about quarters. That's how rapid this thing is moving.

11:08Am I talking to your AI right now? No, no. Now it's me, but you can never know.

11:16So how do you think your tech stack is future-proofing your brokerage for maybe the

11:22next generation of homebuyers and agents? Again, I think that if we don't create a competitive

11:33advantage for agents, somebody else will be coming from outside of the industry. And we've seen some

11:38examples of that happening in the past of companies that came from the outside and thought that with

11:43technology that they can eliminate the agents. Luckily, most of them failed. Some of them are

11:49still alive, but they're not really meaningful. I think that there is a chance that in the future,

11:53something like this will happen. So first of all, this is kind of a defensive move, making sure that

11:59we have what it takes in order to fight with any external force that will be coming in and trying to

12:05take away our agents' businesses and our business. Second, I think that when we're talking about our

12:11agents and when I'm thinking about my kids and the point in time in which they will be coming into the

12:16industry wishing to buy their first home, they will probably be expecting a different kind of service

12:21and a different kind of experience than what the industry is providing them at the moment.

12:25And we want to be that company that really changed the way people buy and sell homes using technology

12:31and primarily using AI in order for my kids to have the kind of experience that they will be

12:36expecting in 5, 10, 20 years from now. So again, it's competitive advantage and at the same time

12:42ensuring the longevity of our agents' businesses and our business as a brokerage.

12:47Yeah, I think it's a huge strategic move, honestly. I don't know that a lot of brokers are,

12:53you know, they're dabbling in AI. But I feel like you're much deeper into it than some of them.

13:02And it's interesting. Yeah.

13:05A hundred percent. I think that within two weeks, I'll probably be able to provide you a phone number

13:09that you can call and actually have a conversation with me and it wouldn't be me. And I think that

13:14at that point, it will be much more tangible than it is at the moment.

13:17Yeah, yeah, definitely.

13:18And by the way, maybe another example. You know, as a public company, we have our earnings call every

13:26quarter. The upcoming earnings call on, I think it's May 8th, there's a scripted part before the

13:36Q&A part. And that part, my part at least, will be read by my AI. It's not going to be me who's going

13:43to read it. And I bet you that nobody is going to notice that this is actually not me. At the end,

13:48we will actually say that. That wasn't me. But yeah, as you said, you can no longer trust whether

13:54it's a human in front of you or their AI.

13:59Yeah, I've seen that, you know, just on social media with AI, you know, selling products from

14:07well-known people that they come out and say, I did not back that product. That's totally fake.

14:13That's an AI-generated, you know, image of me. I don't back that product at all. So it's interesting

14:19how people are already using it.

14:21You know what? That's an interesting point. A couple of months ago, my brother, who's an advisor

14:26to some very large real estate companies on housing innovation, he asked me what we're doing with AI,

14:31and I described to him everything. And he said, you know, it's interesting because we might be at a

14:35situation within a couple of years where the people that are selling real estate are not the same

14:41people that are selling real estate at the moment. And I asked him what he meant. And he said, you know,

14:45let's take Gary Vee, for example. He's an influencer. He has massive following. People trust him.

14:51People know that he's business savvy. Imagine that Gary Vee had an AI tool that would enable him

14:58to service homebuyers without him actually spending time. So, you know, taking them throughout the process,

15:06he would figure out a way to actually open the doors and show the homes to them. But let's think

15:12or let's assume that Gary Vee had a tool that was able to cater to thousands, hundreds of thousands

15:18of homebuyers at the same time. Why wouldn't people buy homes from Gary Vee? And that's interesting

15:24because I think that AI truly has the potential of changing the profile of the people that are actually

15:33selling real estate at the moment. It would go from, you know, real estate professionals to maybe

15:39more of influencers. So it would be interesting to follow. Yeah, I'm all in on this. I want to see

15:46what happens. It'll be really interesting. I want to shift gears a little bit and talk about your

15:52culture because you kind of cited autonomy, upside, and culture as the key drivers of agent recruitment,

15:58aside from the efficiencies of technology on the brokerage side. So how do you intentionally scale

16:06a strong culture across thousands of agents and in a virtual mode?

16:15You do not compromise and you always do the right thing. This is a question that came up when we had

16:21a thousand agents and then 2,000 and then 5,000 and 10,000. I think that if you build the right human

16:27foundations to any organization, that foundation will end up attracting like-minded people. So I

16:34always give the example of I'm Israeli and if you stand in line in Israel, it doesn't really look like

16:42a line. It looks like a bunch of people that are trying to get ahead and get to the head of the line

16:48with no respect to everybody else. If you stand in line in the US, it's a clear line and everybody

16:54respects everybody's space. But if an Israeli traveled to the US and they would stand in line,

17:00they would stand in line like everybody else. So what I'm trying to say is that if you create the

17:06right culture and you make people understand what's expected from them, they will probably

17:13behave and react the way you expect them to. So if you have enough people building the right

17:22foundations, even if every now and then there will be a bad apple coming in and trying to change

17:28things out, they will end up either being pushed out or just changing their way. So I think that

17:37culture is something that we focused on from the beginning. We didn't cut any corners. We did not

17:44jeopardize culture in order to have faster growth, even though we did have opportunities to bring in

17:49people that could bring a lot of agents with them, but we didn't think that they were the right fit.

17:55And you have to think very long term about growth and building your organization. And this ends up in

18:02making the right decisions.

18:04Yeah, absolutely. So you have like an equity and rev share model. So tell me, how do you evolve

18:12those programs to stay competitive? Well, those programs are competitive from day one, just because

18:20of the fact that not too many other brokerages have rev share and equity offerings. It's not easy to

18:28maintain those. I can tell you that. And maybe this is the reason why not too many brokerages have them.

18:33And also, it's not that easy to give back so much to the agents. As we said, this is a low margin

18:41business. And unless you're extremely, extremely efficient, you don't have enough to give back.

18:47So we started doing revenue share in 2020. We started our initial equity program. I think it was back in

18:562017. We took the company public in 2020 just to make that equity publicly traded and a little bit more

19:03accessible. Every now and then, we do some tweaks to our rev share model and equity program.

19:11But at the end of the day, I think that holistically or philosophically, agents come first in this

19:18company. And we want as many agents as possible to be owners in this thing that we're building

19:25together. And it's only right that we have an equity program in place. So there was never any

19:31discussion about whether this is working or not working, or should we or shouldn't we do it?

19:36I would say that currently, agents are the largest shareholders in the company as a whole. And I

19:44expect that to grow over time. And I'm actually happy to see that happen.

19:48That's great. So I want to talk a little bit about kind of the mind of a leader. So talk to me about

19:55maybe your greatest leadership fail, that you failed forward.

20:02Oh, I fail all the time.

20:07You know, everything that happens in the company, ultimately is my responsibility. So if we don't do

20:16well in a certain quarter, it's on me. If we have to end up laying off people, it's on me. In the past,

20:23we laid off almost everybody twice in 2017 and 2018. And I think that that was kind of,

20:31those were two moments where I felt the failure the hardest, just because you're looking in the

20:37eyes of people who believed in you, who put their faith in you, who trusted you, who left their

20:41previous jobs, people that have families that are dependent on you for their livelihood. And you have

20:47to tell them that you failed and you don't have money to pay them. And you have to terminate their

20:52employment. So those were very difficult moments for me. I think that the most difficult moments.

20:58In addition to that, at the same time, in 2018, it was, we were trying to raise money and we were

21:07very close to raising money from a very large fund that, by the way, later on did invest in us a few

21:11years later. But I came to the final meeting with the investment committee. I had to do a decent job

21:18because everybody was sold out already. I just had to show up and not make any mistakes. And I just

21:24didn't do well at all. I blew it. And they ended up not investing. And the company had suffered

21:35serious financial consequences because of that. So what I'm trying to say is that I have a lot of

21:41failure moments. But luckily, I'm also taking some right decisions every now and then. And we're doing

21:47well for the moment. Yeah, well, that's being an entrepreneur, right? I mean, you're going to

21:53fail. It's, it's really not, it's really learning from those failures and taking them to turn them

21:58into opportunities that, you know, is what it's all about, right? Yeah, correct. Yeah. So my final

22:05question is just how, we talked a little bit about how real estate companies have to be more,

22:13you know, they're, you know, they're agent first, but there's a lot of focus on the consumer now too,

22:20that maybe brokerages didn't focus on before. They were solely focused on agents. So talk to me a

22:29little bit about that shift and what it means for brokerage in general and how you see that, you know,

22:37trend impacting the industry. I think that brokerages have been focused on agents for the

22:44past 10 or 20 years, just because of the fierce competition that exists in the industry. And we

22:48lost sight of the consumer because at the end of the day, we brokerages exist because they're in place

22:54in order to serve consumers. That's the ultimate goal. So I think that the fact that there is more and

23:02more chatter about consumer and what's best for consumer is actually good long-term. I think

23:08that the reasons why that discussion started is because of certain lawsuits that maybe were not

23:16beneficial for the industry. But I think that long-term focus on consumer is something that we

23:21should be blessing. I also think that everyone who is speaking at the moment or most of the people

23:28that are speaking and taking a stance when it comes to consumer-facing priorities are doing that out of

23:38position. And I would be happy to see brokerages focused on true consumer innovation and true consumer

23:48experience, because right now we're dealing with things that are still within the realm of brokerage

23:53competition of, you know, this company is doing this and this company disagrees because it

23:58threatens them a little bit. So it's still about the brokerages, even though that the consumer is a

24:02part of the discussion. I don't see enough focus on what do consumers truly want and how can we

24:10allocate resources to provide consumers what they want. It's still very much around brokerages,

24:17unfortunately. What's next for real? What should we be looking for next?

24:20I think that we're heads down executing. We don't really care about the, I mean, we do care about

24:26the market environment because our agents are affected, but we're trying to write our own story

24:34and continue to build and attract great agents to the company. And the number one thing that we do

24:40is constantly try to build value for agents. And we believe that if we build sufficient value,

24:45then more and more agents will be attracted to that value. So for us, it's just finding ways to

24:50deliver more and more value to agents and to their clients and with a lot of innovation involved.

24:56Yeah, absolutely. Well, I look forward to seeing you in person at the gathering in June,

25:02where we dig into some of this and more in our fireside chat. So thanks, Tamir, so much for joining

25:09me. Thanks, Tracy.

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