In the last few months of 2023, we have seen TWO eXp Realty revenue share updates that shook the land of passive income at eXp Realty.
These changes to the sustainable eXp Realty revenue share program instantly created millions more in revenue share payouts to eXp agents. That’s right—in a real estate market where brokerages like Redfin and Compass are laying off agents and others are tightening up profit sharing models, eXp just added millions of dollars more in payouts.
If you’re already part of eXp or simply want to learn more about eXp as a brokerage, you’ll want to understand what these revenue share updates are all about.
What Is Revenue Share?
To better understand these two changes, allow me to detour and explain what revenue share is. Then, we can look at HOW and WHY these changes are massive. Here is an excerpt from the updated eXp Policies & Procedures manual:
The eXp Sustainable Revenue Share Plan exists to provide a financial incentive to the Agents with eXp who have helped grow sales within the eXp family of real estate brokerage companies. The Revenue Share Plan aims to pay out 50% of Company Dollar to Agents who help eXp’s sales grow by attracting fellow agents to join its ranks. As defined in the ICA, Company Dollar is that dollar amount (typically equivalent to 20% of GCI) that eXp retains from commission earned on closed Transactions.
In short, revenue share is compensation for agents who help the company grow. Agents earn this compensation by attracting other real estate agents to join eXp. When those new agents join, they get to select a “sponsor,” defined as the person most influential in their decision to join eXp.
Each so-named sponsor receives a portion of the revenue that the sponsored agent brings to eXp Realty. Operating under an 80/20 commission split, sponsors receive a portion of the 20% from each commission that goes to eXp.
That’s the root of it. For a complete breakdown of revenue share updates and process at eXp Realty, check out this article and video.
Exploring FLQA vs FLA for eXp Revenue Share Earnings
The following chart WILL be your nemesis if you don’t capture the difference between an FLQA and an FLA. An FLQA is defined as a Front-Line Qualifying Active agent, while an FLA is a Front-Line Agent.
The difference between these two agent categories is what makes for the difference in the amount of revenue share received that we’ll go into below.
At its most basic, this is the difference:
- A Front-Line Agent (FLA) is a licensed agent who is personally sponsored by another eXp agent. This agent is part of a sponsor’s “Tier 1.” There are no production requirements or additional responsibilities.
- A Front-Line Qualifying Active (FLQA) agent is defined in the Policies & Procedures manual: “A Front-Line Qualifying Active agent is a licensed Agent who has been sponsored into eXp and that has been active and productive with eXp during the prior rolling six-month period by closing a minimum of $5,000 in Gross Commission Income. In order to unlock eXponential Share earning potential beyond Tier 1, an Agent must have the minimum number of Front-Line Qualifying Active agents in his or her Revenue Share Group.”
The BIG Issue Leading to the eXp Revenue Share Updates
One of the biggest challenges for agents who wanted to participate in revenue share was attracting (i.e. recruiting) PRODUCING agents personally.
Agents that had hundreds or even thousands of agents within their revenue share organization found it difficult to bring agents in on their front line (Tier 1) in order to unlock the eXponential Share column of the Revenue Share chart.
The only way to unlock that share was by attracting not just any agents, but agents that were actually producing! In other words, they needed to sponsor FLQAs. In any given month, agents who had not unlocked all of the levels in which transactions were being closed were missing out on hundreds or even thousands of dollars!
Let’s look at an example to help you understand exactly what I mean. Consider this scenario from the Policies & Procedures manual:
Illustration: Agent directly sponsors 15 new eXp Agents (Tier 1 group), who in turn sponsor 25 more new eXp Agents (Tier 2), who in turn sponsor 40 more new eXp Agents (Tier 3), who in turn sponsor 30 more new eXp Agents (Tier 4). Of the Tier 1 group of eXp Agents, 10 are classified as FLQA which unlocks Tiers 2 & 3 of eXponential Share for the Agent. Agent will now earn:
1. 3.5% of AGCI in eXponential Share on all Qualifying Sale Transactions of the 15 new eXp Agents (Tier 1 group); and
2. 0.2% in eXpansion Share + 3.8% in eXponential Share, for a total of 4% of AGCI on all Qualifying Sale Transactions of the 25 new eXp Agents (Tier 2 group); and
3. 0.1% in eXpansion Share + 2.4% in eXponential Share, for a total of 2.5% of AGCI on all Qualifying Sale Transactions of the 40 new eXp Agents (Tier 3 group); and eXp Realty Policies and Procedures 39 of 85 Version: USA 07.25.2023 POLICIES AND PROCEDURES
4. 0.1% of AGCI in eXpansion Share on all Qualifying Sale Transactions of the 30 new eXp Agents (Tier 4 group). (Note: The above illustration does not factor in application of any SRS Buffer or adjustment bonus.)
So, that’s the issue. Now, let’s consider what changed and why eXp Realty’s revenue share updates are leading to the brokerage paying out millions of dollars more in revenue share to agents.
eXp Realty Revenue Share Updates Explained
It’s time to see EXACTLY how these eXp Realty revenue share updates work for eXp agents.
1. eXp Realty Accelerate Program
eXp Realty has just introduced “Accelerate,” a program that allows new eXp Realty agents to have 10 FLQAs immediately. For their first year (first 12-month period) at eXp, all new agents have tiers 2 and 3 open, given they have at least 10 FLQAs “on paper.”
This new move is powerful and valuable for agents who sponsor teams or brokerages because in that case, the sponsoring agent does not have to worry about opening up their tiers.
Listen, I’m not saying that opening tiers 1-7 is impossible. I myself opened up all 7 tiers within 6 months and I have personally sponsored over 200+ agents.
However, this Accelerate program makes maximizing revenue share more accessible to ALL agents, regardless of how much influence they have and how big of an audience they can reach.
To qualify, you only have to meet these few requirements:
- Be an active eXp agent.
- Work in one of the 24 countries where eXp Realty operates.
- Have joined eXp on or after March 1, 2023.
- Understand that after the initial 12-month period, standard revenue share criteria will apply.
Once again, this change alone has opened up the rev share payout floodgates without having to. This change allows for all agents to experience revenue share at a different level than ever before.
2. Tier 7 Threshold
The second game-changing modification eXp Realty made was lowering the revenue share criteria for agents for the first time in history! eXp just reduced the tier 7 threshold from 40 to 30 FLQAs! That means that agents now only have to sponsor 30 qualifying agents to access the highest eXponential Share compensation percentage.
With this change alone, agents went from earning 4 figures to 5 figures in a single month, while those who were earning 5 figures in revenue share made the leap to 6 figures per month.
I truly can’t overstate the game-changer and life-changer this update has been for eXp Realty agents!
Some agents have been working for YEARS trying to open up tier 7 without much luck. Because as mentioned before, it’s not as easy as it sounds. However, with this change many agents that struggled to get over that FLQA hump were awarded extra revenue share they didn’t see coming!
Conclusion
Now, you understand why these major eXp Realty revenue share updates are changing life for eXp agents. If you’re interested in joining the party and learning how to access revenue share in the quickest way possible, I invite you to set up a call to become a partner. If you’d like to learn more, here’s what our group is all about.