For Mark Stark Success Is About Leading With Purpose

ARTICLE FROM: RISMEDIA

Last month, Mark Stark, CEO of Berkshire Hathaway HomeServices (BHHS) Arizona, California and Nevada Properties, took the leap and sold his company and transformed it from a franchisee to a wholly owned part of the HomeServices of America family. At the time, it was one of the nation’s largest franchisees within the BHHS portfolio, and Stark told RISMedia that the move positioned his organization to increase its foothold within the areas it served, as well as provide the infrastructure necessary for growth.

The move is not only indicative of what’s happening around real estate in terms of the uptick in consolidation, but it’s also indicative of how Stark has remained pragmatic and forward-looking in his approach to running his business. His approach and professional acumen have not only elevated his reputation within his territory and BHHS, but also within the industry.

With that in mind, we wanted to dig a little bit deeper and hear more about the transaction, what it means for Stark and his company, as well as learn more about his leadership philosophy and what he believes real estate professionals should think about in today’s dynamic market.

Caysey Welton: Take us through the genesis of the acquisition and why you felt it was the right time for your company.

Mark Stark: It comes down to one main thing and that’s Gino Blefari. I’ve known him for 17 years and with him at the helm, I cannot have a higher level of trust. I know what I got, and I know I have somebody that will have my back and gets what I do. So that was the No. 1 catalyst.

Full disclosure, HomeServices has reached out to me every year for the last five years; business was really up this year, and I thought this was probably a good year to look at it. Then Gino came to me and said, “we’re going to look at it,” so I said “ok, I’m all ears.” It came together and I’m really pleased, and he’s pleased.

It’s rare, even though it’s only been a month, but it’s everything I thought it would be. There’s some change, but it’s all good stuff and everyone is positive and supportive. I love it.

CW: Let’s go back to your history with Gino for a moment, who’s well-respected throughout the industry; tell us how he earned the trust and respect you have for him.

MS: We talked during the downturn—the big one during ’07 – ’08—and we were going through some of the same challenges. He’s the real deal. There is no BS or ego. I got to have the opportunity to learn what he’s made of way before this [current] opportunity. He’s never disappointed. There are rare people in this world, and certainly rare in my life, at his level that are so consistent. It’s a breath of fresh air.

CW: You mentioned after the acquisition that you’ll still be running the day-to-day and overseeing the company’s strategic vision, but how do you see your role changing or evolving in the coming months and years?

MS: Nothing has changed for the company. For all CEOs, that’s our No. 1 concern.

My schedule has changed. So have the responsibilities of communication within the HomeServices network for me and my president Gordon Miles. So, that has been an adjustment. You have to fit that schedule within your schedule and not just around it. But I have to say that’s about it.

In general, Berkshire Hathaway HomeServices and the parent company, that’s what they like to do—buy quality run organizations and leave them alone. Though there’s some incorporation of financial information and streamlining company stats. It’s a great dynamic, which I knew for years after talking to the other CEOs who sold their companies to HomeServices. That’s their M.O.

CW: Let’s talk about your company’s success over the past year. For the most part, that was true for a lot of real estate professionals. But in general, it was a year full of unprecedented challenges, so how did you lead your organization through it all?

MS: Separate from the specifics of what the pandemic did to our business and the focus on homeownership and low interest rates, I’ve always believed there’s many environments in business that you wouldn’t choose—certainly COVID being one of them. However, in any environment, just like in the 2007 and 2008 downturn, there will be brokerages and agents who win, and there will be brokerages and agents that don’t win. I want to always be in the winning category. So, the question cannot be about the challenge or the environment you didn’t choose; it’s what are you going to do to have your agents and company achieve their goals?

You have to be hyper-focused on your vision and where you’re going as a company, and not focus on the issues themselves. If the house is on fire, I can’t be focused on the flames; you have to be focused on the goal—get the family out safely and get out of the house. You have to have a focus, and we are very good at that. We’re able to lead around the noise and stay focused on what we need to accomplish and not let the whirlwind pull us from side-to-side.

CW: Your acquisition aligns with a broader trend of consolidation in real estate. What are the clear benefits for companies that sell to larger organizations?

MS: When you’re an individual owner like myself, whose company is on pace to do somewhere between $8 to $9 billion in volume, to do acquisitions and build infrastructure is expensive. So, if you want the best financial support and to grow via acquisition and organically, you put it all on the line. It’s a lot of risk, which is why I think consolidation will continue.

When a market adjusts, there will be two camps: the camp that has a chokehold around it and the camp with opportunity. By doing this transaction—I have put myself in the opportunity camp. If there is a downturn, we now can grow through it because of the power of HomeServices of America. We can also pick up a lot of market share and come out very strong.

If you don’t have that kind of power or backing, then it’s a chokehold. Say you do an acquisition, and you have millions of dollars’ worth of debt and now there’s a downturn, and now you’re meeting with banks, etc. Well, I don’t have to do any of that. I can use my highest and best purpose to go into the marketplace to gather quality companies and sales execs because I don’t have those problems. HomeServices has plenty of dollars. That doesn’t mean they are going to do anything stupid, but they will never be in a chokehold situation. Instead, they can ask “what are we going to do?” in a positive way. There are going to be companies that have challenges, and we are going to want to pick them up for a song.

If you think you can grow organically, you’re lying to yourself and limiting the success of your organization. That doesn’t sit well with me.

CW: As an experienced leader and real estate professional, did you learn any lessons over the past year that will be helpful to you and your organization in the future?

MS: Through every challenge, you hopefully pick up nuggets and take some lessons off the table because if you don’t, then you have your eyes closed. But with this issue, assume nothing.

If you go back to April and May of 2020, it was horrible. The business stopped and plummeted. You look at that and say, “here we go again,” but you buckle down and do what you need to do. Then you start doing the right things and you notice things going in a reverse direction.

It goes back to the circle of knowledge. And I don’t mean to be too general, but it’s important. You know what you know, you know what you don’t know, but the kicker is you don’t know what you don’t know. And that’s the one that gets people.

Every conversation I have with a manager, an agent or another executive better have those ingredients, otherwise you let worry and turmoil lead the company. Don’t get me wrong, some are valid turmoil—say if someone loses somebody or somebody close to them gets sick. These are not instances where you can expect people to stay positive. But you have to lead through that; and the only way to do that is to have a clear vision forward. That includes being respectful, loving and empathetic through tough times. It’s really a sensitivity of leadership in general and being authentic.

You take all these pieces and parts and lead with a proper vision and support. None of it happens by accident, so it’s an ability to have a feel or touch for all these aspects that matter to people. We can’t be everything to everyone, but as a leader you can be empathetic while still driving things forward and that’s what we were able to accomplish.

CW: We’re certainly not out of the woods yet in terms of the pandemic. In fact,our research recently revealed that 42% of our readers are still seeing impacts with their business. That said, it does seem as though we can see the light at the end of the tunnel. What excites you about that notion?

MS: We’re on a fun and exciting track as a company. We’ve upgraded all our technology. It wasn’t just a technology upgrade, but a hyper-local focused leadership support upgrade. It really helps you as a manager do your job better and helps your agents grow their business and allow them to communicate with their consumers. That has really got me excited and inspired for the future. We’ve never had that opportunity. It was our vision and we’ve talked about it. It was sort of like saying, “I can’t wait until we can time travel.” We can talk about it, but we aren’t able to do it today. Now we’re able to do the things we were talking about 18 to 24 months ago.

This industry is not for the faint of heart. If one thing is true, it’s change. You have so many competitors with so many visions. So, in terms of who’s right? Time will tell.

CW: That segues nicely into the flipside of that last question, and that is do you anticipate any challenges or new pain points as we forge ahead into the unknown?

MS: Nothing that concerns me like what happened in ’07 and ’08, not even remotely. Do I feel like prices will adjust? I think we are going to be in a dynamic market, and we can’t generalize it. When someone talks about prices going up a percent in a market it’s such a worthless stat. Say I live at 502 Smith Street. It’s 2,650 square feet with no pool, but I do have a larger lot. That’s what I care about if that’s my home. So, if you tell me everything that’s happened in Las Vegas, it’s worthless information to me. You need to bring it down to that local level as much as you can.

If you look at the four markets I operate in, there’s differences. You look at prices; some are going up, some are going down or some are staying flat. It’s easier to look at it all at once and say, “let me give you an average in all four markets,” but it would be a worthless number for you, but it would be accurate based on that silly question. You really need to ask the questions that matter—what is happening to units in that branch, and why? What’s happening to the prices in that local community or one-third of that zip code? The more you look at that and get into those conversations is not where I’m strategizing for the company, it’s when I’m strategizing for a branch or an agent.

CW: Based on that, it sounds like the wins and losses really begin and end at the micro level. So, are you able to manage that from a macro position?

MS: Once you have that hyper-local content, now you know which direction to go. The conversations you have with the agents who work in that area will switch. The agents with listings in those areas, their presentations will switch. The agents who are communicating to buyers in those areas, those presentations will switch. What you do is you take that accurate hyper-local information, and you give it to the people who are having those conversations so they can attack their market with more accurate intel, instead of me trying to do something 30,000 feet up. That doesn’t make any sense.

CW: A never-ending challenge we’re always hearing about is recruiting and retaining talent. Obviously, there’s no perfect solution, but we’d love to hear your thoughts on your approach to attracting and keeping good people.

MS: The key thing is to train the trainer. If you’re managing a branch for me, I need to make sure you can communicate our story and make sure they understand it. We spend a lot of time making sure our leadership can communicate our message effectively. That’s No. 1.

Two, you have to make sure you are providing real, authentic value. You can’t just sell. You’d better offer a better mousetrap to buyers, sellers and agents.

There’s one mistake so many brokers and agents make. When you ask them why they changed companies, very few will ever bring up the consumer. You won’t hear, “This new company is better for my buyers and sellers and here’s why.” It’s rarely even a thought. They don’t realize they take themselves out by the knees.

The mistake that sales executives believe, some but not all, is that “clients use me for me.” What I correct them on is that clients use you for themselves. What they’re saying to you when they choose you is that, at this moment in time, I believe you and your organization are the best choice for my family, my equity, my property or whatever the case may be. As soon as you lose sight of that, you lose business. It can not only cost you thousands of dollars, but it costs you some amazing clients over the years and it costs you the future growth of your business.

People can’t forget it’s all about the consumer; it’s not about the broker or the agent. And the smart brokers and agents who get that are unstoppable.

CW: You’ve shared a lot of great nuggets of wisdom, Mark, so to wrap this up, what bit of advice do you have for new or mid-career professionals in the field striving to achieve success like yours?

MS: Success to me is having foundational thought processes. I don’t care what business you’re in, you need that aspect to be successful. If you’re getting into this business now and have that understanding, which is not just one thing, but is a foundation of things. Focus on your strengths and nurture those strengths. Get others to help you with the skills that aren’t your strengths. Don’t try to be the best someone else you can be, be the best you that you can be.