Do they require you to open a store front up front or are you able to work it from your home office?
Brightway vs Goosehead - Franchise Agency Opportunities
- Thread starter johnkearnsagency
- Start date
Do they require you to open a store front up front or are you able to work it from your home office?
myfakename
Super Genius
- 163
Serious question- why not find a local independent agency to go to work for? Most will pay 40-50% of commission and no overhead. Seems like a no brainier to me??
I connected with the Goosehead rep and he says they rely on referals from loan originators. I'm sure it works to some degree, but I'm dubious
I found this interesting because when I did my walk through with SF reps, nearly all of them were spending heavy on internet leads to grow. Their "negotiated" rate was $12-15/ lead, but some were getting them down to a few dollars and one even found a way to get leads for a buck. Most of these were garbage, but they offset this with volume- ring the phone enough times and they'd get 3-8% attach rate.
It sounds like you've been doing this for a little while and have experience with poking at other methods for carrier access. The 25k up front seems like a lot to put down to get a renewal split that is pretty weak. Now maybe GH earns it with the admin portion, but I don't know enough to know better.
Another thing I'm vague on, is IF you sell, does the buyer have to pay another 25k to pick up your book? That'd be a sticking point. I read somewhere that Brightway has a hefty fee for this. It didn't sound like GH had that, but I was not specific when chatting with their rep.
The question for any of us is---in 5 years what would cause you to want to leave it and what would you leave it for?
What I like about the GH model is
I found this interesting because when I did my walk through with SF reps, nearly all of them were spending heavy on internet leads to grow. Their "negotiated" rate was $12-15/ lead, but some were getting them down to a few dollars and one even found a way to get leads for a buck. Most of these were garbage, but they offset this with volume- ring the phone enough times and they'd get 3-8% attach rate.
It sounds like you've been doing this for a little while and have experience with poking at other methods for carrier access. The 25k up front seems like a lot to put down to get a renewal split that is pretty weak. Now maybe GH earns it with the admin portion, but I don't know enough to know better.
Another thing I'm vague on, is IF you sell, does the buyer have to pay another 25k to pick up your book? That'd be a sticking point. I read somewhere that Brightway has a hefty fee for this. It didn't sound like GH had that, but I was not specific when chatting with their rep.
The question for any of us is---in 5 years what would cause you to want to leave it and what would you leave it for?
What I like about the GH model is
- No quotas.
- Access to a lot of carriers on day 1.
- Ability to write business polices.
- No pressure to spend on marketing (or so it seems)
- No pressure to sell bad products
- Pretty loose with the storefront requirement
- Exit is better than a SF or other captive options
- No sales lead coming in and telling you how to run your ship.
- Agency software (presuming you do close to no work on the renewals or other servicing)
- E&O is part of the monthly fee
- 25k for the weak renewal rate.
BADTROUT
Guru
I'm going to be up front and tell you we do business in Washington so my opinion is not completely unbiased. That said I will give you as fair an assessment...
- No quotas: This may be because you are a branch agency of GH, meaning, the stress of the quota falls on the agency brass versus their branch managers. The alternative would be having your own agency name/relationship with the carrier and direct underwriting access as you, not as an employee (or as they say, agency owner).
- Access to a lot of carriers on day 1: This is true for most groups
- Ability to write business polices: This is a great feature, one I firmly believe in and I think this is great!
- No pressure to spend on marketing (or so it seems): MMMMmmmm not sure about this... now there likely isn't a mandated marketing push, but you'll still want to market regardless of your affiliation
- No pressure to sell bad products: ALWAYS sell the right fit for your customers' needs, being indy gives you that freedom, this is good.
- Pretty loose with the storefront requirement: The modern insurance companies are going cloud-based, why shouldn't agencies if they choose. Again, I agree with this flexibility.
- Exit is better than a SF or other captive options: Is it? I would rather have 1X of 80% than 1.5X of 50%... Even more, I like an exit where I do have the option to sell, with no restrictions.
- No sales lead coming in and telling you how to run your ship: You should really think about this one. You would be a representative of a large publicly held company. Make no mistake, you aren't the captain of the ship.
- Agency software (presuming you do close to no work on the renewals or other servicing): It's great this is included for uniformity.
- E&O is part of the monthly fee: Honestly, you shouldn't need to pay E&O because you are at a branch level in reality. This feels like a way to unnecessarily cost share or monetize the E&O.
BADTROUT
Guru
Andy, Yes I absolutely do own an agency and an agency network that I founded, so I think that's what gives me a unique perspective as to what to look for in a contract... I've picked them apart and written them from word one.
There are some things every group gets right, and there is usually stumbling blocks in every agreement. The company I founded is going to be a great fit for some agencies, and others maybe not, there are many variables. I think a good long comparison of the contracts, when looking at each point made in the forums like this will allow people to get an idea of what they are looking for in a group. It's disheartening for me to read some contracts people have signed and really don't have a full perspective of what they just got themselves into, so I come here to assist, to consult and give a little back to an industry that's been good to me. I have always been happy to weigh options with people looking to build something for themselves, even if I am not one of the options on the table. I try to be as upfront with that as possible, hence the disclaimer on my opinion piece above where I state my opinion is slightly biased, although I try to give good general advice.
So to answer your question... Yep, I do own one, but I am not here representing it any more than the little blurb under my signature.
TexasVet
New Member
- 17
I know Goosehead touts referral networking with realtors and mortgage loan officers. They do not recommend internet leads.
This is taken from their February 2019 investor presentation. GH has Corporate Agents and Franchise Agents (what we would be if we signed up.) Looks like the majority of Corporate Agents are straight out of college
Also in the presentation they claim their young, Corporate Agents are 3.4x more than the industry best agents. Their Franchise Agents are only 1.5x better.
So if they are giving you world-class training and service... why are you lacking behind so poorly compared to their in-house Corporate Agents?
This is taken from their February 2019 investor presentation. GH has Corporate Agents and Franchise Agents (what we would be if we signed up.) Looks like the majority of Corporate Agents are straight out of college
Also in the presentation they claim their young, Corporate Agents are 3.4x more than the industry best agents. Their Franchise Agents are only 1.5x better.
So if they are giving you world-class training and service... why are you lacking behind so poorly compared to their in-house Corporate Agents?
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It's a matter of preference and life stages.
If you need a paycheck and/or there's no other path in, then that's a good way to go until some of the groups that require experience will let you in.
Tough to describe, but when you reach a certain point in life/career, you just need to be your own boss.
I don't know enough to criticize, but going from a captive agency to either franchise seems like an illogical choice. If you have experience and a sales record, a cluster or group would welcome you with open arms at much better terms.
I think I mentioned this to John in a private message, but the captive agencies seem to love taking people that have no insurance industry experience and don't know any better. Prove that you won't go bankrupt and your not a jerk and they'll take you. No one is dropping their independent agency gig to run towards Farmers, StateFarm or these two franchise options. It's established that agents run from the name brands once they learn better. I can't speak to the franchise options having an exodus, but their end of the deal is a little lopsided and I don't see anyone with an established track record going there over a cluster or group which doesn't require a huge chunk of flesh up front.
The "servicing" value prop doesn't resonate with me- according to the agents I've talked to this is when you do a lot of your selling both of yourself and of more product - "hey have you priced life insurance???"... and that's coming from the name brand with the WORST life products on the market. You want those conversations because your friendly voice and that relationship with you is what they want.
I know they have a lot of people doing decent, but personally, I think there are better ways to spend 25k. I mean- you could buy a lot of existing policies that are already earning for that kind of cash and just pick up a part of someone elses agency who is retiring. At least then you have a payback period of 2 years and could sell at any time vs however long it's going to take you to earn your way out of a 25k sunk cost ---that if you died tomorrow would be worthless to your heirs.
I think I mentioned this to John in a private message, but the captive agencies seem to love taking people that have no insurance industry experience and don't know any better. Prove that you won't go bankrupt and your not a jerk and they'll take you. No one is dropping their independent agency gig to run towards Farmers, StateFarm or these two franchise options. It's established that agents run from the name brands once they learn better. I can't speak to the franchise options having an exodus, but their end of the deal is a little lopsided and I don't see anyone with an established track record going there over a cluster or group which doesn't require a huge chunk of flesh up front.
The "servicing" value prop doesn't resonate with me- according to the agents I've talked to this is when you do a lot of your selling both of yourself and of more product - "hey have you priced life insurance???"... and that's coming from the name brand with the WORST life products on the market. You want those conversations because your friendly voice and that relationship with you is what they want.
I know they have a lot of people doing decent, but personally, I think there are better ways to spend 25k. I mean- you could buy a lot of existing policies that are already earning for that kind of cash and just pick up a part of someone elses agency who is retiring. At least then you have a payback period of 2 years and could sell at any time vs however long it's going to take you to earn your way out of a 25k sunk cost ---that if you died tomorrow would be worthless to your heirs.
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