Originally posted on RealtyTrac.com and Inman News.
In 1972, my dad, John Jacobi, a young banker at the time, wanted to own his own business. He bought a small, eight-agent residential real estate business in the Seattle neighborhood of Windermere. At the time, he wasn’t trying to make history — just a good living for his young but growing family.
He had a simple idea: build a real estate firm that put relationships before sales quotas, with an emphasis on service to clients and community. His vision was to hire the best sales people, arm them with the best tools, unleash them into the marketplace — and let them build their own businesses under the Windermere Real Estate brand.
With no brokerage experience, he instilled a family-oriented and agent-centered culture at Windermere, where agents conduct themselves professionally, with honesty and respect for all parties. By putting friendships and relationships before sales, my dad created a collaborative environment that fueled innovation and success.
That approach turned out to be groundbreaking in the industry, and I’d like to share the core concepts behind the blueprint my father created for success. I believe those same principles can be beneficial for many other brokers across the country in this 21st-century real estate environment.
During the 1980s, my dad shook up real estate by offering a better commission structure for agents. Because he believed that entrepreneurial motivation made for happier, more productive agents, he discarded the traditional 50-50-split rule and introduced the graduated commission scale.
At Windermere, agents split commissions 50-50 with the broker until the agent reaches a particular goal. From that point, the agent takes home 80 percent, and the broker gets 20 percent. Ultimately, Windermere sweetened the deal even more and made it possible for agents to keep 100 percent. Sliding commission splits attracted higher producers to our company while discouraging the one-off producers.
Collaborate. Dominate. Differentiate.
My dad also discouraged competition among the agents — or between offices. What sets us apart and is central to our success is Windermere’s belief that our agents and owners are our most valuable assets.
Slowly, dad’s vision started to take root. With each new office that opened, he would seek out like-minded entrepreneurs. As he added new brokerages, he would expand through synergistic partnerships with businesses in which he held a minority stake but retained voting control and ensured each of those partner companies would maintain the quality he believed in as we rapidly grew. Eventually, we gained over 30 percent market share in the Seattle area.
Eventually, Windermere Real Estate became a 300-office operation, with nearly 7,000 real estate professionals in 11 states and Mexico and closed over 77,000 transactions annually for more than $27 billion in sales.
“The Windermere Way”
Windermere’s way of doing business is grounded in four core values: relationships, collaboration, professionalism and community. My father instilled these values in us — early and often — and they are at the heart of everything we do.
For us, working at Windermere isn’t a day job; it’s about a 24/7 ongoing conversation about how we can do things better and succeed. When we plan, we don’t necessarily think about the next five-year goal — we think about how can we leave this business for our kids. It’s long-range strategic thinking. Indeed, the company culture that my dad created and fostered over the years is still alive today.
From day one, Windermere has aggressively embraced community service, fervently believing that helping the communities where we live and work is vital to our business.
It started in the early 1980s, with our annual Community Service Day, a company-wide initiative where we close all our offices for a day so that our agents, owners and staff can give back to the community.
During this time, we’ve volunteered more than 1.2 million hours of community service. Followed in 1987, by the sponsorship of the annual Windermere Cup, a collegiate rowing regatta hosted by Windermere and the University of Washington. It has grown into one of the premier international rowing competitions, attracting the top crews in the world.
Two years later, we launched the Windermere Foundation, a 26-year-old nonprofit organization that has donated over $28 million to organizations that support low-income and homeless families throughout the western United States.
Windermere’s core business model is franchising. Connecting agents, brokers and customers to close transactions promptly is crucial to our success. Today, technology drives this collaboration. But it’s deeper than that.
Internally, we don’t compete against each other; we collaborate. Because we’re a tight-knit family-run company, when a good idea comes up, we share it with the other franchise owners. The lack of competition among the Windermere franchisees is one of our strengths. The close, collaborative relationship among all franchise owners is something the Windermere culture has worked hard to foster. For us, it’s all about teamwork and trust.
At Windermere, we’ve recently noticed an interesting family dynamic blossoming — and it’s not just with the Jacobi family, but it’s spreading to our business partners, too. A significant number of our 300 offices are transitioning to second-generation ownership. At last count, one-third of Windermere’s original franchise owners have passed their businesses on to their children. And our family business is young, too. Most of the second-generation Windermere owners are in their early 40s to mid-50s.
Now that my dad has retired, management of our family business has been in the hands of a tight-knit, second-generation triumvirate. It includes my sister, Jill Jacobi Wood, who joined the firm in 1985 and is president of Windermere Services; Jill’s husband, Geoff Wood came on board in 1994 and is CEO of Windermere Services. And I joined the firm shortly after that and now serve as president of Windermere Real Estate. Together, the Jacobi family also owns eight Windermere offices with about 300 agents throughout the Seattle area.
As we enter the 21st century, the family team is in it for the long haul, preparing the third generation for the next transition and continuing the positive momentum and expansion in the years ahead. We’re a forward-looking company; we’re always acting rather than reacting. We don’t worry about quarterly profits as much as we think about our kids and the next generational succession plan. It’s a different way of thinking about the real estate business. And it works.