Often an agent who is new to the real estate industry is urged to start off by joining a team or brokerage that provides leads. But why?

What does joining a team structure really mean?

Momentum has observed that many of those recommending new agents join a team haven’t actually been on a team themselves, thereby lacking the valid experience to share and make such recommendations. Sometimes they make the suggestion out of self-interest, and sometimes they might not even have had much success themselves as an agent. 

In its nine months of existence, Momentum has seen top agents from top teams in Northeast Florida leave their teams in droves.

We have seen them struggle to get out of restrictive, often financially insecure environments in order to become their own boss and begin their wealth-building, entrepreneurial journey with Momentum.

We’ve heard their stories about the real-world advantages and disadvantages of being on a team.  And, as a former top team, now a top brokerage, Momentum suggests that any agent thinking about joining a team consider these serious pros and cons before making that decision:

Leads

Pro:  Many teams provide paid or referred leads to you as an agent. That gives you a starting point for developing sales.

Cons: Lead generation is the most important aspect of being a successful agent. When they are handed to you by a team, you run the risk of becoming reliant on the team for obtaining leads, and often don't learn how to lead generate yourself. Also, team leaders often cherry-pick leads and hand you the ones that are "hard to close."

Database

Pro: The team may have a large database for you to help work.

Con: The team often keeps the database you create, should you leave the team in the future. That means if you leave, you're starting from scratch again.

Splits

Pro: None. You'll net less, often 50%+ less -- on top of other splits.

Con: Financial opportunity is usually cited as one of the top reasons that agents get into real estate. But with the usual 50%+ splits with your team leader, it becomes very challenging to achieve a high level of financial success.

Transaction Coordination

Pro: Transaction coordination is often provided by teams, and having it available is very helpful when you are in the learning process with contracts.

Con: Leaving this aspect of sales to others means you may not understand the process, and be capable of doing it yourself. It also could create an attitude of not taking responsibility for the outcome, or becoming spoiled by being used to not having to deal with the nitty gritty. If you do go out on your own, that attitude has to be unlearned.

Learning

Pro: You learn from those who are already doing it.

Cons: Unfortunately, many teams, even those that have been in business awhile, may not know or implement best practices. If that is the case, what you are learning could be wrong and self-defeating.

Hours

Pro: You often have a pre-set schedule to follow.

Con: That pre-set schedule means you have little control over your hours.

Keep in mind that joining a real estate team is often very similar to becoming a W-2 employee, dependent on the team for providing essentials such as lead generation and managing transaction details, even for telling you when and how much to work. 

When you later realize that the team structure is not preferential, and decide to try operating independently as an entrepreneur, it’s often like starting all over again from zero.

Sometimes it means having to learn essentials you should already know as an agent but had let the team do, leaving you without necessary skills.

Sometimes it means unlearning bad practices and adopting new, better ones.

As an entrepreneur, at least initially, you have to generate your own business, do your own transaction coordination, and start your database from scratch.

You have to unlearn much of what you were taught on the team because being a successful solopreneur is a completely different world.

So, in many ways, one of the biggest downsides of being on a team is about developing the wrong mindset. It is about relying on others to handle parts of the process that you should know and be skilled at handling yourself if you want to succeed as a solo agent. Being on a team can mean working long hours to take home a fraction of your commissions, and not even getting the basic foundation in attitude and skills that you need to later create your own business. It could mean wasting years before really beginning your journey to financial stability,  a better lifestyle, and the satisfaction of earning success on your own.   

There is another path for new agents. Instead of jumping in unprepared and feeling compelled to take the easiest route by joining a team, first become more financially secure before entering the field. Have a business plan. (You must save the money needed to live on for a few months and fund start-up costs for your business.) Then interview more brokerages to find one that offers the right training and the mentoring that will help you become successful as a soloprenuer.

You'll get to your big life faster this way.