Good morning. What if I told you some of the biggest names in real estate—eXp Realty, Keller Williams, and RE/MAX—operate using the exact same profit structure as multi-level marketing companies?
These brokerages have built massive recruitment machines where agents make money not just from their own real estate transactions, but from taking cuts of every deal their recruited agents close. The MLM-style recruitment bonuses come directly from the inflated commissions you pay when buying or selling.
The MLM Structure Hiding Behind Real Estate Brokerages
Here's how traditional MLM companies work: Recruit distributors, take a cut of their sales, encourage them to recruit more distributors, and build income streams from multiple levels of their "downline."
Now here's how eXp Realty operates: Agents recruit other agents, earn 2-5% of their recruits' commissions, get bonuses for hitting recruitment targets, and can earn from up to seven levels of their recruitment tree.
Several major brokerages use MLM-style profit sharing. Whether it's eXp's "Revenue Share," Keller Williams' "Profit Share," or RE/MAX's Profit Share Program, the model is identical: recruit agents, take cuts from their production, fund it through higher consumer paid commissions.
The pitch is identical to classic MLM: "Build your team, create passive income, achieve financial freedom through recruitment."
The $2 Billion Consumer Overcharge
Keller Williams proudly claims they've paid out over $2 billion in profit share since launching their program. That's $2 billion extracted from buyer and seller commissions to fund recruitment activities rather than improve client service.
eXp Realty's financial disclosures show millions in recruitment-based compensation annually—money that ultimately comes from the commissions charged to you when you buy and sell.
These brokerages have abandoned their responsibility to train competent agents, instead teaching recruitment while expecting undertrained agents to handle your largest financial transaction.
The math is simple: More hands in the pot means higher costs for consumers. Every dollar paid in recruitment bonuses comes directly from inflated commission rates you're charged.
When your agent's income depends on recruitment, here's what you get:
Cookie-cutter service designed for volume, not your specific needs
Higher commission rates to fund recruitment infrastructure
Pressure to become an agent yourself if you show any real estate interest
Less focus on innovative marketing that actually sells your property
The brokerage profits most when agents prioritize recruitment over developing expertise that benefits your transaction.
These companies teach agents two primary scripts: how to recruit other agents and how to convince you that 6% commissions are "standard"—not how to provide transparent service or fair pricing for actual work performed.