The Illusion of "Free" Agents: Why the Burn-and-Steal Model Is Killing Agency Owners Too
There is a persistent illusion in the property industry: That agency owners can extract value from agents at almost no cost.
Open an agency. Recruit as many agents as possible. Let them bring in deals. Take a cut. Low cost. High upside. Easy business. This belief explains why so many people want to open agencies every year. It is also why so many agency owners quietly disappear a few years later.
The Fantasy: Agents as Free Labour
On paper, the model looks brilliant. Agents are treated as independent contractors. They fund their own marketing. They absorb their own risk. They generate their own deals.
The agency:
- Takes a percentage
- Carries no payroll burden
- Has minimal fixed costs
The only visible expense is recruitment. From this angle, agents appear to be free production units. That is the illusion.
The Hidden Reality: Agents Are Not Free — They Are Unstable
What the model ignores is turnover. In a burn-and-churn structure:
- Most agents leave within 12–24 months
- Experienced agents are constantly poached
- Teams never stabilise
- Knowledge leaks continuously
So the agency never compounds. It is always replacing. Recruitment stops being a growth activity and becomes a survival cost. And unlike systems or inventory, people walk away.
The Prisoner's Dilemma of Agent Poaching
The industry quietly accepts one rule: “If I can take your agents, you can take mine.” Everyone assumes this has no real cost. That assumption is wrong. When poaching becomes normal:
- Loyalty collapses
- Training becomes irrational
- Long-term investment in people stops making sense
Why train deeply if another agency can take them tomorrow?
Why build capability if exits are always one offer away?
So agencies respond rationally:
- Minimal training
- Minimal support
- Maximum short-term extraction
This accelerates churn. And churn destroys everyone.
Why Agency Owners Burn Out Too
This model does not only damage agents. It exhausts owners. Agency principals end up:
- Recruiting nonstop
- Managing constant exits
- Resolving internal politics
- Fighting retention fires
Revenue becomes volatile. Forecasting becomes impossible. Teams never mature. From the outside, it looks like scale. From the inside, it is chaos management. Many agency owners do not fail publicly. They simply burn out — and leave.
The Race to the Bottom No One Wins
In a system with:
- Zero switching cost for agents
- No shared infrastructure
- No structural cooperation
The only levers left are:
- Unsustainable commission splits (leaving 0% for operations)
- Lower standards
- Short-term promises
Owners are forced to give away the entire margin just to keep bodies in the room. They are generating revenue — but they are not generating profit. This is margin compression disguised as growth. Agencies without systems or defensible structure cannot compete. Even well-intentioned agencies are punished if architecture is missing.
Why Culture Alone Is Not Enough
Some owners try to solve this with culture. Culture helps — but it is fragile. Culture without systems depends on:
- Personal loyalty
- Emotional commitment
- Constant leadership presence
Under pressure:
- Culture cracks
- Poaching resumes
- Trust evaporates
Without structure, culture is expensive to maintain and easy to break.
The Structural Truth No One Likes to Admit
The illusion of free agents persists because:
- Costs are delayed
- Damage is distributed
- Exits happen quietly
But structurally:
- Burn-and-steal agencies do not scale
- They do not compound
- They do not last
They survive on motion, not progress. And motion is exhausting.
What Actually Defends an Agency
Agencies that survive long-term do not rely on extraction. They rely on:
- Systems that reduce agent turnover
- Infrastructure that agents depend on
- Cooperation that is structural, not optional
When agents gain more by staying than leaving, poaching loses its power. When value lives inside the system, not just the brand name, the agency becomes defensible. That is when the agency becomes an asset — not just a fragile cash flow stream.
Final Reality
Agents are not free. They are expensive to replace. They are costly to lose. They are impossible to compound without structure. The illusion that agents are free made opening an agency look easy. It also made running one unsustainable.
The agencies that survive the next decade will not be those that recruit the most agents. They will be the ones that stop treating agents as free inputs and start building systems worth staying inside. Because in the long run, you cannot steal your way to stability.
