RE/MAX at 50: From disruptor to household name
From a mom-and-pop business that was "us against the world" to a global real estate powerhouse, RE/MAX has remained focused on growth and agent success.
- RE/MAX launched in 1973 with a new approach to agent commissions that challenged the status quo.
- The company's franchise model proved to be a winner, allowing it to expand quickly across the globe.
- Looking to the future, the "agent-centered company" plans to continue seeking out top producers and crafting services to support them.
Dave Liniger founded RE/MAX 50 years ago with a revolutionary idea: Let real estate agents keep 100% of their commissions. In return, have them pay a monthly "desk fee" to work at the company.
Liniger's business model differed radically from the traditional fee structure that gave brokerages a significant cut of the agent's commission. And the established firms did not like that.
"It was us against the world. What we were attempting to do was pay the nation's top agents better," recalled RE/MAX founder Dave Liniger, who chairs the board of RE/MAX Holdings. "That put me on the hate list of every other real estate company."
On January 30, RE/MAX celebrates its 50th anniversary with a company-sponsored founders' day that is a salute to Dave Liniger and Gail Main Liniger, his wife and business partner, for the legacy they created: a global real estate company with 140,000 agents working across the U.S. and 110 countries.
Making agents the heroes
Liniger always believed his idea would pay off — and it did beyond his wildest dreams. From a mom-and-pop business to a global corporation, the founders lived the American dream.
In 1973, Liniger launched RE/MAX from a nondescript single-room office in Denver, Colorado. His first employee was Gail Main, whom he hired after interviewing 28 applicants. They shared an enthusiasm for the challenges of starting a business from scratch.
The two hit it off so well they married. Together, they grew a business that challenged norms and transformed an industry with the rapid expansion of RE/MAX franchises and an agent-focused mission.
"High commission split was a big part of what we had going for us in the beginning," recalled Gail Liniger, vice chair of the RE/MAX Holdings board. "The advantage of that is that you attract the experienced full-time producers in the business."
"We figured the agents were doing all of the work and taking most of the risk but only getting half of the compensation," said Daryl Jesperson, who was CEO of the company in the early 2000s.
Abby Lee, senior vice president for marketing, said that prioritizing the agent's role is a theme that continues today. "We are an agent-centered company. We strongly believe in showcasing our agents. They are the heroes in getting the transaction completed in the best way for our clients."
Cultivating franchises and a memorable brand
Success was not immediate for the Linigers. They went into debt by $300,000 after the first year, when their investors lost faith and backed out. But Liniger's idea did catch on with agents, and that enabled RE/MAX to keep its doors open and continue growing.
In the 1970s and 1980s, the Linigers had a company vision but said they never imagined the scale and scope that RE/MAX would command today. The company opened its first franchise outside of Colorado in 1975, and just two years later, RE/MAX became an international presence with an office in Canada.
Cultivating franchises turned out to be a big differentiator for the company and is an approach that continues today. All RE/MAX brokerage offices are operated by franchisees whose business is independently owned and operated.
The RE/MAX commission model also has evolved. Agents no longer keep 100% of their commissions. But the company's 95/5 split is among the highest in the industry, where the standard split ranges from 50/50 to 70/30. RE/MAX also offers more traditional split options for agents who don't want to pay a separate desk fee each month.
"We are all specialists in providing products and services to help producers become more successful. We are totally devoted to the top producers," Liniger said.
RE/MAX also invested heavily — and creatively — in its brand. From the maiden flight at a New Mexico festival, RE/MAX-emblazoned hot air balloons helped to define a brand that has become one of the most recognized in the industry. "The RE/MAX balloon is the most powerful image in real estate. That's been the case for decades and will be for decades to come," Lee said.
Asked what's in store at RE/MAX for the next 50 years, RE/MAX's current president and CEO Nick Bailey said the company remains focused on growth and agent success.
"We're going to make sure that this network is filled with the most professional productive agents and that we design our services around what they need to get there," said Bailey.
Correction: An earlier version of this story misidentified RE/MAX's SVP of marketing. She is Abby Lee.