How to Recover from $2.3M Wire Fraud & Build a Tech-First Title Empire | Title Agents Podcast Ep46

In a world where change is the only constant, Mo Shumil stands at the forefront, guiding title professionals to not just grow their businesses, but to master the art of innovation. With every episode, you're handed the keys to unlock unparalleled growth and stay ahead of the curve. Get ready for a transformative journey. Hello, everyone, and welcome to another episode of the Title Ages podcast. I am your host, Mo Shumil, CEO of Alltech National Title.

Today, I have a pleasure to be joined by Aaron Davis, CEO of Florida Agency Network. From scaling one of the largest title operations in the Southeast to being at the forefront of technology and automation, Aaron brings a powerhouse of insight. We'll talk about building a successful team, adapting through market shifts, leveraging technology and why giving back is just as important as growing your business. Let's jump in. Well, Aaron, welcome to the show.

As we start off every episode, we'd love to hear your story, your background, how you got into the business, where you went to school, the family, all that fun stuff. Oh my gosh, I got into the business kicking and screaming and begging to not stay in the title industry. That was my intro. It's called being born into the business. Thanks for having me, Mo.

I appreciate you having me on. My story is probably like a lot. Title seems to be very much a family business, oftentimes like generational businesses. My mom started our original title agency, it was called Hillsboro Title. She created it now 41 years ago.

We just celebrated our 40th anniversary last November. She had just recently divorced my dad. She was 26 years old. I was, I think, eight years old. My brother was like five or six.

She started a title company in Plant City, Florida, which is an agricultural farming community just east of Tampa. It's more widely known as the winter strawberry capital of the world. Never heard of that, but now I've learned something. There you go. Now you know the winter strawberry capital of the world.

Not a summer, not a spring. Winter capital. That's right. That's right. Heavy agricultural community population of call it 32,000.

She started the title company. Like any small startup business, if you've got kids, you just bring your rug rats and tell them to sit in the corner. My job was picking staples out of the carpet and refilling the paper flip jars. Make copies and whatever. That's right.

That's right. My son loves to go to the office until he's 11 years old, but his motivation, we have Dr. Pepper. He'll do whatever it takes for a can of Dr. Pepper.

Tea flavor. That's right. If we get to hit the snack bar or the bubble gum machine on the way in, then that's a win. Yeah. Literally, I jokingly say I've been born into this industry.

I'm 49 years old. I've been working here since I was nine. I'm in my 40th year in title. Is your mom still involved or is she retired? She is recently retired.

I had to ... I joke with everyone. I say there's two ways into this business. You're either born into it like me or you're tricked into it like everybody else. There's one way out and that's a pine box.

Fortunately, my mom is not in a pine box. She is not deceased. She is still with us. She just retired about a year ago, more so just to take care of my grandfather's getting up there in age. When she transitioned the roles, her passion was really title examination.

She really loved solving title problems. That was her passion all along. It wasn't necessarily owning a business or selling or closing. It really was like the art of solving the problems is figuring out a creative way to get a deal closed that a traditional underwriter or a traditional attorney may not have thought about. Let's get an affidavit from the brother-in-law or let's go ahead and there's an easement problem.

Let's go ahead and create a transaction in order to buy the problem rather than going a traditional route. She just enjoyed that part of it. Awesome. When did the name change from Hillsborough to Florida Agency Network? Yeah, that's a story in itself.

I purchased my mom outright in September of 2008. Perfect timing. Bye. Yes, the best timing of all time. I learned how to lose a lot of money really fast.

During that period of time, I'd gone away from title. I went to University of Florida, got a degree in finance, I thought I wanted to be a stock broker. I was a Series 7 and Series 7, 63, 215. I got all the licenses. I worked in a financial planning firm for a few years.

Those years, unfortunately, were 99, 2000 and 2001, which was a prior recession. That was the dot-com tech bubble bust. That tech bubble bust put me right back into title insurance, where I came back to my mom begging for a job. From there, I learned operations. I grew up in the business.

I was the company courier, post-closing, processing, closing. Once I came back in, I started to learn more of the operational side and management and people and growing a business. I bought her out in 2008. We still only had one office and we'd just opened a satellite location down the road. Small business with 10 or 12 employees doing 30 closings a month.

We survived the downturn. We went through 2008, 2009, and 2010. After that, we started to acquire other companies, grow in different geographic locations. Her business, again, it was Hillsboro title. That is Hillsboro County, Florida, where Tampa is located.

When you try to grow into neighboring counties, there's a geographic limitation in people's minds. We couldn't continue that brand when you're going into Pinellas or Polk or Pasco County. We started the multi-brand strategy. We started affiliated businesses with different real estate brokerages around the area, started acquiring neighboring companies. Once we realized we needed to create some sort of unifying brand, we created the Florida Agency Network.

Now, it is a network of independently operated title agencies in and around. At that point, Tampa Bay, Central Florida. We had offices in South Florida, Miami. I think at that point, we were up to 30, 40 locations, 12 or 13 different brands via acquisitions and affiliated businesses. That born the Florida Agency Network.

That's awesome. You've grown the Florida Agency Network into one of the largest title operations in Florida. What were some of the key decisions or strategies that helped you scale successfully? Hold on. We'll see.

Well, I think, first and foremost, you can't do it without the best people in the industry. I was very fortunate along the way to just... I think I was always very active in the industry. If you go back in the 80s and 90s, there was very much of a defensive mindset. I think people were very territorial, and they never really networked with their neighbors, and they never really went to...

A lot of small agents never got involved in land title associations or Alta or anything else. I just took a different approach and got to know everybody. When the downfall started to occur, people start to run. They get layoffs, and corporate shuts down 20 offices, and chaos occurs. So, first was just hiring great people.

My president of operations, Amy, has been with me for now 17 years. So she joined me early on in the growth. And then as we started to grow and pick up great closers and great books of business and acquisitions, a lot of those acquisitions had great people in it. So we started to develop what is now a very robust leadership team. So can't do it first without people and a great culture.

Because anyone can go work anywhere else for a paycheck, but they have to love what they do, and they have to love who they do it with. So I think that was literally the foundational element of what will create our success was people and culture. Looking back, what's one challenge you faced in building the Florida Agency Network that turned out to be a major growth opportunity? Well, I'll tell you, years ago, this was such a subject that we didn't discuss as agents. There was an embarrassment, if you will, around wire fraud.

So this is now, for me, this is 10 years ago. 10 years ago, we were hit early on with one of the first business email compromise cases in the country. It was all new to us, where there was a sophisticated closing, there was lots of moving parts to it as a commercial transaction, and all of a sudden, we close on a Thursday, and it's a holiday weekend, and then Monday rolls around, and the sellers call in looking for their funds, and you're like, well, here's the confirmation, I sent it to you. And turns out, we sent it to the bad guys. And so that transaction, that was, we had wire fraud.

email compromise cases in the country, it was all new to us where there was, you know, there was a, you know, it was a sophisticated closing. There was lots of moving parts to it as a commercial transaction. And, you know, and, and all of a sudden, you know, we close on a, close on a Thursday and it's for, you know, it's a holiday weekend and then Monday rolls around and the sellers, you know, call in looking for their funds. And you're like, well, here's the confirmation. I sent it to you.

And turns out we sent it to the bad guys. And so that transact, that was, we, we had wired $2.3 million to the bad guys. And thankfully we jumped on it and we're able to do a lot of things. But I, I took the, I took the position in that transaction based on the players involved and based on, you know, based on certainly I'm going to get this money back soon. I funded that money out of my pocket.

So I liquidated a lot of my personal assets. I put a lot of my personal cash. I took a bank loan out to fund $2.3 million to keep everyone else safe. And then I said, I will, I will chase this down. So we are now 10 years later and I still do not have that money back.

It it's thankfully it's where it's, it's, it's isolated. It's, it's in an account and it's a whole other story, but going through something like that, that, that makes you, you know, that, that will definitely, you know, for the, for the most part that usually sinks agencies that that's something that people can't, you know, can't, can't fund. And as, but, but I'm like, I'm not, I'm not letting, I'm not letting a mistake, you know, take us down. So we created an IT company out of that. We came, we created our centralized services division out of that.

We, we went full compliance SOC one, SOC two, you know, bringing in a CISO on staff. I mean, so we got heavy into the IT infrastructure and centralized processes. So there's always, you know, there's always eyes, you know, eyes on the transaction doubled, you know, double checks and triple checks you know, a centralized wiring division, you know, a lot of times that, you know, back then I think everyone had like wiring process was at every single branch perhaps. So we just brought everything. We just started thinking about what's, what, what can we do to protect ourselves going forward?

And that spawned, that was our, our IT division premier data services, and then our back office company network transaction solutions. So that, that was kind of the pair, a huge loss and a massive. This podcast is brought to you by struggling to set appointments and generate leads. What if you had a team working behind the scenes to help you book more meetings and close more deals at all tech national title, our dedicated inside sales team, help you find your pipeline. So you can focus on what you do best building relationships and closing business.

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So that was literally the, the, the, the, the, the, the, what could have just cratered us, made us, made us a hundred times stronger. That's awesome. That's a resilience at its best and truly turning a lemon into a lemonade. It's a kudos to you. I'm very proud of you.

Thank you. Thank you. That's a, it was, I don't, I don't suggest anyone doing that by the way. Viewers watching at home, please do not do that. Listen to what they do.

Don't do as I say. What does that do? As I say, not as I do. Yeah. Do that one.

That's a, I mean, wire fraud and social engineering is truly a, it's a, it's a big problem. Like when we have all the, all the tools and all the, the services and still, yeah, like mistakes happen and just chasing the money and it just sits out. But the worst that from a title agent's perspective in years past prior to them, the worst that could happen is you could have missed a tax bill or you can misprorated a payoff on, you know, so, so the worst could happen. You could lose a couple thousand dollars on a file. I never thought in a million years that you could just lose $2.3 million overnight.

Wow. I hope one of these days you'll be able to retrieve that money and we're going to go on a trip together. I am, I'm, I'm, I'm literally months away is now 10 years later. We have, we have passed like a lot of different obstacles to get there. So the money is supposed to be on my way.

So it is, it has been what I call my four savings account. If I had that money in my pocket back then, I probably would've just made stupid decisions with it anyway. So now I'll have some, a reason to actually celebrate. That's awesome. So, I talked about M&A, Mergers and Acquisitions and extension.

You've acquired and partnered with multiple agencies. What's your approach to integrating new teams and maintaining a strong company culture? I'd say that's one of the most challenging, that integration and trying to match different cultures and people and teams. And yeah, it's been a challenge for us. I would love to hear your, how you've done it and how it is.

It's, it's start, it starts with knowing the equity. It starts with you being a known quantity in your, in your, in your market for having a good culture and good people. Because if all of a sudden, if news, news hits that I'm, I'm purchasing, you know, ABC title down the road, if those, that staff and those leaders and everybody else think that we have a bad reputation, that just blows the whole thing up first and foremost. So again, back to, back to, back to people, leadership and culture, that's first and foremost. But of the folks that are being acquired, it's the same.

Like you have to do so much due diligence on who's being acquired, that the people are great, that they have a great reputation, that they, and, and, and, you know, I liken it back to an acquisition we did back in 2013. A Paramount title was down the road. They had been, literally Jim Farr had started his company the same year my mom started. They started in 84. We were in 84.

We were great competitors for years and years and years. And I just had such a high admiration and respect for what they built. And you, you never lost a deal because there was, you know, undermining and dirty dealing. It was always just, you know, good, good, good, good competition. And, and I met him at a, at a conference and we just struck up a conversation, a little sidebar.

And, and I said, you know, I'm, I'm, I'm looking to acquire companies. And he said, well, I'm, you know, I'm actually looking at the retirement at some point, and I'd love to have that conversation with you and respect you. So it was a very organic conversation. And, and, you know, it, it, we, it just flowed, it worked nicely. I mean, one of the things that we did early on is like, we, we both said, and I, I suggest a strategy to everyone.

If we, we, we said, I said, look, let's just write down our top five things are important to us, you know, so the top five things, and we, we jotted them down and then we traded them. And what was interesting is money was not number one on either one of our list. So money is number one on the list. I just, you know, if you're looking for the highest bidder, I'm not your guy, you know, but if you're looking for the right fit and the right culture and the right structure and what's going to work for everyone, then, then let's talk. So that company now, you know, they, they had about a dozen employees.

I'd say, I think eight of them are still with us to this day, 12 years later, and five of them are now leaders in our company. They have moved up the ranks from just working at a branch or two to now managing divisions. That's fantastic. And how do you guess the integration piece, you know, like, especially when you have different systems, different platforms, going to like the, I know you're big on technology and automation, going to like a paper company, it's how you've done things and how do you combat that? Or how do you kind of make that financial scooter?

That takes a while. I mean, that takes a while, that takes a dedicated team. I mean, especially if you're on different title production systems, you know, so you've got the, you've got the marriage of title production systems. You know, eventually you, you do want to put everyone, I believe on the same system. There's not, there's not a, there's a few pieces of technology out there that are starting to connect the dots on, you know, in some, but for the most part, you know, you can't, you can't always get, you know, title production system one to talk to two, to talk to three, to talk to four, that it's clunky, but it's getting there.

There are some, like I said, some good tech companies out there that are making tremendous strides in doing so. So the tech stack is important, evaluating that tech stack and then checking out, are they just so far apart? You know, are we talking, are we talking one's running on AI learning and the other is a typewriter? You know, so if you've got, if you're acquiring a company that's still running on typewriters and whiteout, you know, I use that jokingly, but if that, if they're so far behind technology, technologically wise, that their folks are going to see changes as fear, you know, fear of change, that's going to be problematic. So, and so that's, again, it's another one of the assessments of the cultural pieces is, you know, you have to make sure these days that everyone sees change as it's going to make their lives better.

You know, if there's roadblocks along the way and they're not going to see the betterment of it, you're going to have an issue the entire time. far behind technologically wise that their folks are going to see changes as fear of change, that's going to be problematic. And so that's, again, it's another one of the assessments of the cultural pieces is you have to make sure these days that everyone sees change as it's going to make their lives better. If there's roadblocks along the way and they're not going to see the betterment of it, you're going to have an issue the entire time. So the integration's key, eventually getting everyone on some sort of unified front so that you can manage all these operations and have everything flowing through to like a back office so that you can manage.

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You know, reporting and accounting and all those things are super important. And then the management, the change management of the staff is just hugely important. You've got to have people. You can't just stroke a check. Hey, we just bought you and hope for the best.

Like it doesn't work that way. You just wasted all your money if you did it. So if people can see that your system, get the buy-in of the person being acquired by them looking at how well your operation runs and seeing the efficiencies there and selling them like, wow, did you guys know that we're now going to not have to do post-closing at the branches? We're not going to have to, you know, your closers aren't going to be, have to email and fax for funding and initiate wires and do the post-closing themselves anymore. Just little wins like that when you can tell them like, you know, this system is a better system and makes your life easier.

That's all. Let's move to automation and technology. Florida Agency Network has been a leader in adopting technology. What role has automation played in improving efficiency and the client experience? Yeah, we're sometimes a more bleeding edge than cutting edge when it comes to that, but we enjoy it.

I love, look, I mean, I grew up in a title agency. I'm going to guess I'm one of the few out there that can say that I've been in title for literally 40 years to see a company come from no technology. We had typewriters in whiteout, you know, and then our first servers, Nobel servers, DOS based prime time systems, dot matrix printers, policy and triplicate, hand balancing HUD statements to go from that. So then like I literally acquired our first email domain, HillsboroTitle.com and then emails and then servers. And don't, I mean, so to go from no tech to AI, we've seen it and we've lived it.

So, and, and, and, you know, and, and my folks too, we've, we've, we've all been in the industry to kind of see that progression. So you, you're looking at this, this, the, the progression needed for your clients, your, your consumers are getting younger and younger and more tech savvy. And so the expectation is click button Bible. That's what we have to, that's what we have to be able to produce at some point. So we're, we're constantly working on ways to bring in new technology to say, how can we eliminate steps in the process?

How can we eliminate duplicate data entry points? How can we make things more seamless along the way? So there are some, you know, some folks invest in, in title production systems to do that for them. Changing title production systems is difficult. I tell people, you know, it's like between changing my bank account and my title production system, I'd rather just cut off a pinky.

I'd rather lose a toe or two. Maybe I could probably back, probably still balance without a middle toe. But that's painful and difficult. But what's great is these days is there are so many add-on technologies and so many integrated technologies, whether that be communication tools, you know, front of the house, whether that be AI performing automated order entry, AI now doing a lot of the post-closing, you know, tech stack. Also, also just, you know, implementing, you know, better communication tools and a lot of video, you know, so it's like all these pieces we're, we're having to realize your, your, your consumers are, you gotta meet, you gotta meet consumers where their expectations are.

And their expectation is on my cell phone and in my text. And, you know, that, that, so those, those are the things that we've been focusing on for, for years now. And we've, we've now, we've got AI on the front end communication wise, outbound on, on file communication. We've got it on the order entry side of the house. We've now implemented on the post-closing side of the house.

We've got it underlying all of us on the, on the IT infrastructure for, for better cybersecurity and better spam, spam management. So yeah, we're, we're, we're, we're bought in and I'm using now Grok daily 10 times a day. I'm, I'm Grok in chat GPT. So what, what the title production software are you using? I'm not here to promote anybody, but just to- No, no, no.

And I'll tell you, there's a lot of fantastic ones out there. We, we moved on to soft pro select back 10 plus years ago. And, and we, and I love, I love, I love their tech and I love the ability. My, my, my thing is always, I need to make, I need to be able to control my database. I need to be able to control my data and I need to be able to customize my workflow.

And I want to be able to use the tools that I want to use. So I want to use the CRM of my choice, business analytics tools of my choice, AI integrations and tools of my choice. So I just really like the flexibility and customization that it brings to me. But there's a lot of them that do all those things in a, in a, in a, in a combined closed loop unit. And so I'm still give you the ability to customize at will.

The, you're talking about post-closing some automation and AI, is that a proprietary, something you built or you're using off the shelf? And actually, you know, I, we, we, we've, we have, we've got a few different, we've used Alana and then now we've used a real for different pieces of it. But Python, it has a fantastic, a piece of piece of tech as well. So there's a lot of different providers out there. It is just a lot of platonic.

So I've not heard of it. Python. Yeah. Python. Yeah.

Python. Yep. So they've got, they've got some great, you know, I sat it on a demo of, it was three of the different providers on their post-closing automations and they're fantastic. And they, some of them have better integrations with different TPSs than others. So, you know, if you're on ResWare, this one looks good.

And if, you know, if you're a software or a RandQuest or what have you, or Qualia. So, but, but ours, ours was, it was, we have such a custom environment that we need the ability to customize. So when an order comes into my, my, my universe, we put in the triggers. So it's order comes in, contract is read, auto fills, you know, all of the order entry fields and automatically fires off a title search, lean search, and HOA, like boom, boom, boom. We want to build those automations and we want it.

And every title company kind of does things differently. So I just like the flexibility and freedoms that the, you know, all of our providers have given to us. Yeah. So how are we leveraging technology for cyber fraud protection? This podcast is proudly sponsored by need extra hands without extra overhead.

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Safi Virtual, expert support tailored for title professionals. Uh, so we, we are, we are utilizing, uh, man, we're utilizing, uh, certified. We're utilizing. They're awesome. Yeah.

I'll sort of, uh, we're utilizing proof, uh, we are utilizing a, um, and, and the name of it for, uh, uh, escapes me right now, but it is on, we have a piece of technology built into outlook, um, that is automatically detecting, you know, um, it, it, it would be spam type email or phishing type email scams. We have the ability to just click a button. If one person gets the email, you could click a button. This looks fishy, sends it to the review team. They review it and then whitelist it.

Uh, but then too, that, that if you have a person that, you know, consistently is maybe causing the problem, then it'll automatically isolate that person and then put them into a training mode. So, so we're. of technology built into Outlook that is automatically detecting spam type email or phishing type email scams. We have the ability to just click a button. If one person gets the email, you could click a button, this looks fishy, sends it to the review team, they review it and then whitelist it.

But then two, that if you have a person that consistently is maybe causing the problem, then it'll automatically isolate that person and then put them into a training mode. And all of those have an AI component to them. And again, it's just, it gets smarter and smarter because it's learning your environment. So how do you think AI is gonna add more value to the entire industry besides the data entry piece and the stacking of documents and post-closing? Yeah, you know, and I caution everyone.

We all went down the blockchain road a few years ago and thought that blockchain was gonna be the end of us. You know, and then we thought that OCR and the RPA, Robotic Process Automation, and then this is just gonna put us all out of business. And then now AI is gonna put us all out of business. We're finding that AI is just augmenting and adding more ability to the staff. So I utilize like order entry, for instance.

We used to have five full-time employees doing order entry every single day. Orders come in, type, type, type, copy, paste, copy, paste, do all this other things. So now that is down to one person who is in charge of quality control over that entire division. But those people, we didn't, we don't just automatically fire the people. They get to get, they're promoted into other divisions.

So now it's just, you know, we're just trying to take those duplicate processes and streamline those. AI is going to assist us with underwriting and the capability of, you know, under, we get all this information from underwriters. We have to log into their systems and we have to, you know, check all this information. AI is gonna help us in that functionality. It'll, it'll, it'll, the underwriters are already, you know, implemented on their side to speed up the searches.

You gotta check out my title, gpt.ai. Please, please do. To solve, it's on its baby stages, but it's exacted for that, to solve that problem. And I've had, you know, I've talked to so many agents and, you know, I've got agents who have created like, you know, basically a chat GPT overlay on their entire database. There's a new tool that's just come out just here recently that will just, it will read and analyze your entire title database.

Basically just imagine, imagine chat GPT on top of your database and I can just query, hey, pull every single buyer in the last four years with interest rates above 7% and give me all of their emails and cell phones. Like that type of, that type of ability. And by the way, now let's go ahead and just automatically dump that into a marketing campaign and do an outbound text to everyone because today's rate's just at six and a half. You could save $400 a month on your bank. That's, that's where it's at.

Oh, it's powerful, you know, and it's being an asset to our clients as well. You know, cause I mean, how many people are in our databases from, you know, 10 years ago that the lenders are out of business now? You know, so, so it's just, you know, it's, it's, it's smart. It gives us, it gives us a better positioning, a better value proposition in the, in the real estate, you know, the old, the ecosystem. That's cool.

Well, let's shift gears to philanthropy and giving back, which is a big to me and you, you're a big philanthropist and so you're a big advocate for giving back. Can you share some philanthropic initiatives that the Florida Agency Network and you're personally involved in? Yeah. You know, we, like everyone, I think we're, we're very, you know, we're, I think we're all passionate about, you know, our local charities and we do, you know, we, we, we we're volunteering all the time and we're always giving back monetarily, physically, et cetera. You know, one thing, one thing that I fell into by accident a few years ago, I'm originally from Tampa, Florida.

I currently live in Austin, Texas. I'm, I started, you know, dating a girl long distance, you know, multiple, several years ago. We actually, we actually met on LinkedIn. So we actually turned LinkedIn into a dating app. So I'll, if anyone wants to go offline.

Did not know that. No, I did not know that. So we, so we met professionally, but you know, we was sparked, we got a spark. So I ended up moving to Austin, Texas. We were dating, I was dating from afar and there was a natural disaster that hit here several years ago in Texas, a severe snowstorm and my girlfriend at the time, it flooded out her house and it created all sorts of chaos.

I flew in to help her out and I went and volunteered and you know, long story short, this volunteer work landed me in People Magazine. So there was a story done and I took the, I took the story and I promoted it to the, to my LinkedIn, to my social medias and I ended up raising a hundred thousand dollars for this little local fire department to help, you know, help their firemen go out and, you know, take chainsaw trees off the little old lady's houses and that sort of thing. So, so that was a, that was an accident, but it ended up kind of putting me on a path and that path was around natural disasters. For whatever reason, my calling in life, I guess it is helping people that have suffered in a natural disaster. So now we've done a snowstorm in Texas.

I'm from Florida. We've done multiple, you know, hurricanes. So I ended up, the hurricane a couple of years ago, me and my brother, the hurricane impact was in Port Charlotte, Florida. We went and loaded up our trucks with about 30 chainsaws, drove down, started helping the community and, and you know, putting the chainsaws in the hands of people that, that could, you know, that can use them. That ended up in People Magazine again.

And the next thing you know, we get a call from the Kelly Clarkson show. So now we're flying to Hollywood. Kelly Clarkson then donates, you know, 30 chainsaws to our efforts. So now we're like, I'm the Tampa Chainsaw Man and we're the Chainsaw Brothers. And then this last hurricane that Milton, that hit right in my hometown of Plant City, it was a catch five, you know, directly in impact.

It just flooded out the entire town. I flew in, bought a hundred chainsaws, bought thousands of meals and, you know, was just trying to help. Cause literally our office was like, our office park was like ground zero. The whole town was without power, you know, people didn't have any food. So we went in there to do the thing.

So, so this, this, this, this, this natural disaster thing seemed to be one of my callings in life. So I'm in the, I'm in the, the, the process of starting kind of a foundation called HERO, Hometown Emergency Response Organization. And my goal is to be able to, to help, you know, help folks that are in, in those harms way and natural disasters come in and make decisions. Cause what I find is when you get impacted, you are, your brain doesn't function and you're just trying to worry about your family and your livelihood and your friends and getting, you know, getting yourself out of harm's way. If I'm able or other people that can help me, we can come fly in and, and not be connected to the disaster, but, but work and act like CEOs, like, like many FEMA's, get there before the, get there before the Red Cross and FEMA and all the federal agencies get there.

But that those first few days are, are, are huge. And that's where the biggest needs are. So, so that's kind of been my new calling in life. Continue to bring, bring awareness and help folks in, in natural disasters. Yeah.

So for title professionals looking to make a difference in their communities, what advice would you give them? You know, we are a very geographic industry. And I think every agent does a great job with this. They're always so, they're always so involved. You know, they, they start their agency, they start their business, they get involved in local rotaries and Kiwanis clubs and, and those types of things.

They get involved in, in different charitable aspects. But, you know, this, this, this hurricane thing, this, this natural disaster thing to me, you know, one of the, one of the thing it was like, it was like an afterthought. You're, whether it be tornadoes, snow storms, hurricanes, fires, what have you, usually it's homes that are impacted and we are in the home business. And if those homes are harmed, we lose closings. We lose, you know, we lose revenue.

We lose, and it's our status. It's our people that are affected by this. So again, this is where I have this affinity for natural disasters and helping out is, you know, literally to go and get people back, get back to, back to, back to some sort of normalcy of life. So if you look, if anyone, if any of these are agents in Florida, you know, I, I say next time there's a hurricane and you have happened to survive them, you know, especially if you're, you know, in the middle of the state and you, maybe your dog's just not as impacted. Those folks on the Gulf, they get hammered.

The people on the Atlantic coast, the Keys, they get hammered and they really need help. So if there's any way for you to, you know, if there's a way to give back, whether it be financially, giving, giving, even giving up homes. I have so many friends who are agents nationwide who just literally see those hurricanes coming and go, hey, if your staff needs a place to go, if you guys need to drive North, if you want us to handle some of your files, you know, that's the thing is like. Today's episode is sponsored by. Hey, you title agents, stop wasting time digging for answers or waiting on email or callback from your underwriting with title GPT.ai.

You get instant reliable answers to your title questions. agents nationwide who just literally see those hurricanes coming and go, Hey, if your staff needs a place to go, if you guys need to drive North, if you want us to handle some of your files, you know, that's the thing is like. Today's episode is sponsored by. Hey, you title agents stop wasting time digging for answers or waiting on an email or call back from your underwriter with title GPT dot AI. You get instant, reliable answers to your title question.

No more delays, work smarter, close faster, and keep deals moving. Try www.titlegpt.ai today. There may be a natural disaster in Florida, but if a lender out of Washington state may not be aware of the disaster and they don't, it's not that they don't care, but there's, there's rate locks and there's a transaction and there's still buyers and sellers happening. So, so that, that, that network and that community aspect of title insurance and the real estate transactions of what we do I just say, just be aware and raise a helping hand and give back how you can. That's awesome.

Well, thank you for all the good work you do and keep it up, brother. Let's, let's talk about a save the market. What are some key market trends you're seeing in the Florida real estate landscape and along with the national level, what are the, what are, how are they affecting the title professionals? Well, at least these dang interest rates. I mean, I think everyone kind of feels, feels the interest rate, but I think we're all, I think we're all waiting for, you know, it's like you, you start to feel a little bit of good and then, you know, the right teams, yeah, there's the teams that, you know, so I think the, look, anyone of these, anyone we've, you know, I know by person, I've been through the old one, I've been through 08.

Um, and, and if you think about though, the normal real estate cycle is seven years up one to two years down, right? Well, we just happen to go 14 years up and then a COVID and then, you know, weirdness, uh, and so we're, we were, we were due for a three to four year recession, I mean, so whether it be a recession and downturn or what have you. So I feel that we're in year three entering four. And so, I mean, I think we're seeing some bottoming, bottoming out in some markets. A natural disaster, hurricanes and tornadoes do not help matters because all they do is crush, they just crush homes, build the inventory and then people have to rebuild and all of that stuff.

So I think we're seeing that in a lot of the Florida markets, Naples, Tampa Bay, especially the panhandle. Um, you're seeing all of that, the, the, the condo situation in South Florida is a disaster, you know, just the, the, you know, there's all sorts of, uh, economics there, but, but there's still just a, there is a demand it's there and whether it be executing or pent up, um, it's coming. So I think, you know, the, the, the, the long of it is this year seems to be a lot like last year, Q4, Q1 of next year is what I'm, I'm kind of thinking if I have a crystal ball, uh, you know, kind of thinking that's when it's going to get better, but I mean, honestly, as long as you, you've scaled your business, as long as you have right-sized it and, you know, a lot of the agents I'm talking to, I mean, they, they've right-sized they're, they're profitable, you know, maybe not as profitable as they once were, but they're making money, they're getting by. Um, and, you know, it's going to be, you know, we, we, you know, we will get through this together. Um, and that's why I say the, the, the, the power, the power of scaling your business, the power of having a flow in and out, uh, you know, outsource, you know, whether it be outsourcing, insourcing, whatever, you know, just to be able to, just to be able to serve, you know, if you've got a tough month, uh, or, you know, all of a sudden you, you, you lose a processor, you know, and you, you, you can't hire fast enough and you, you know, you, I, I think that's an important piece of, of what, uh, there's an important piece because I think what's going to happen to, um, we're going to see a mini refi bill at some point rates are going to drop.

We're going to see a little bit of a, of a push. And all of a sudden we're going to all get a flood of orders and you better be able to execute on those. So are there any new regulations or compliance issues that title agents should be paying attention to? Uh, well, um, since the CFPB just got gutted, I don't know. We have three regulatory is always the wild card, you know, it's, uh, it's highly states.

That's again, more, I guess, uh, the law, even the last three to five years, the state's taken more, like more, but it is, you know, if you, cause you watch what happened in DC last year with the earthquake minerals, you know, you're, you're seeing some of the action, the activities, uh, Arizona has some activity. I mean, it's always scattered and, and, and around, um, you know, but I do, I do, I do like, you know, there is, there was talk of rest over form. Um, and then now maybe actually some, some better guidelines put out, you know, rather than being regulated by, by fear and regulated by, you know, um, uh, by, you know, someone else getting, uh, pounded. How about let's know what we're allowed to do. I mean, I think a lot of people, a lot of people want to do the right thing, but right now we're bound by, you know, in Florida for, for instance, you know, our, our title rules are 30 years old.

So they didn't know about a rod. They didn't know about virtual office locations. You know, there's still the right, still state like brick and mortar. I mean, so, but the, the world's changing. I mean, COVID changed us all.

We're all working in a more of a centralized work from home, you know, here I am in my home. Um, so I think a lot of the regs need to catch up to where the industry and the technology is. With, uh, more, uh, with more competition and it's a slower demand transaction wise and industry consolidation, how can, uh, independent title agencies differentiate themselves and stay ahead? Um, I definitely think working, I think you have to invest in, in your business and that, that investment is in the technology side, you have to be at a point where you can do more with less. Um, you know, if it used to take you, you know, uh, you know, 20 files per employee, you know, then, then how do you get to 25 and how do you get to 30?

Uh, because if there's going to be higher competition, uh, there's going to be margin compression. Uh, there's going to be, you know, the, the, it's like the big get bigger. And, you know, the small, the, the, the small agent always, it's been at risk for years and years and years. Um, but I think, you know, I think we're going to be walking into a world, you know, in coming years with the, um, you know, the changes that are happening with the, uh, the clear cooperation rules, um, you know, buyers, agents, uh, commission starting to, to, you know, to, to, uh, to go down. Yeah.

I mean, you know, look, real estate brokerages are going in order to survive going forward, they're going to own their own mortgage and their own title and their own, uh, property and casually insurance. I mean, they're going to have to, in order to survive. So, you know, one-stop shop, uh, would have the Redfin and, um, rockets and that's, that's a future that I'm sure, I'm sure, you know, you know, the stat like last year, 70% of agents did zero transactions, like realtors. Yep. So it's a, it's a very few, 20, 30%, you gotta go after it really is.

So you have to make a decision. I think it's now, it's, it's, it's going to be in the next 12 to 24 months. You know, it was like, is this business for you? You know, is this what you want to do? Uh, if so, uh, who are your agents now?

And are they going to have, are they going to, are they going to be, um, you know, is there going to be pressure on them to use affiliated title services, the in-house title, that sort of thing? So if so, you know, do you have alignment? Are you, are you, do you, would, would being a partner with another title company or a network, or are you looking for an acquisition? I mean, just kind of, yeah, I think you have to think people, people think about the next 12 months, but they really need you to talk about, you know, what's the next three to five years look like and where do they want to sit in that? Absolutely.

Uh, go on, uh, what's your formula or there's one, uh, how many employees per file, how many files per employee? And he said 25. I'm like, Oh, it literally is. I have, you know, you hear people are like, Oh, that's 50. And then some are like, you know, 15, you know, it's all over the place.

So it depends, it depends on the type. It depends on your structure, you know, and, and, and, and, and, and, you know, is your employee doing take a vial from soup to nuts, or is it just a processor closer team or is it just a closer who does the. So, you know, you, that's such a, that's such a, as a global say, the, like, the end riders, like that's 15 to 20, is always 15 to 20 has always been kind of a national average. I've heard it's across the board, every single person, including leadership. That's.

Yeah. No, I think you have to, you have to carve out, I think you have to carve out sales, you have to carve out leadership. So this is just people actually working on the file, 15 to 20 always seemed to be a number that has, has been there. But then, you know, then you talk to people and if they, if, if, if they're out, if they don't have to, if the processor doesn't have to organ, you know, order the HOA and the mortgage payoffs, and there's less communication with the agents, is this a, a purchase transaction with a realtor on both sides of the table, or is this an REO fund? So all of those variables.

So take out refiles, take out REOs, take out like all cash deals. And then if it's boutique, is it high in multimillion dollar transaction with lots and lots of touch? You know, it's, it literally varies, but 15 to 20 has always been kind of a, kind of a good, good, good number to use. Awesome. Well, we're, we're coming to a close and I always end the show with a couple of questions.

One of them is, do you have a favorite quote? Uh, you know, there's one of them. How about that? What does it say? Let's see.

Let me see if I can get it there. Nobody cares. Work harder. I love it. You know, and you know, it's kind of, um, uh, you know, it's like with us, we just say, I don't, I, I don't, don't, don't let the economy, don't let what others are doing, don't let what the market just head down and row.

There's one of them, how about that? What does it say? Let's see, let me see if I can get it there. Nobody cares, work harder. I love it.

It's like with us, we just say don't let the economy, don't let what others are doing, don't let what the market, just head down and row. Every once in a while, head down, row, grind. Every once in a while, look up to see where you're at. I think so many people just used to judge, it's always looking at competitors and looking at all the other things, but at the end of the day, do what makes you happy. And if you are good as a small agent and it's a controlled environment and you love what you're doing and you're passionate about it, keep doing it.

If you're looking for something better, then grind harder. How about a favorite book or a favorite book you read recently? All right, well, I'm gonna be a little bit promoting here, but this is literally, he's done such a great job with this, but my best friend in the world since sixth grade, worked in corporate for 30 years, he wrote a book, it is now a Wall Street Journal bestseller, USA Today. He's been doing corporate coaching and all this other stuff. So it's, the book is begin with we, and it's 10 guiding principles around corporate culture.

And so, but it's, we hold ourselves accountable and we do this as a team and it really aligns with our culture of we. I never say someone works for me, they work with me. So that is a, so his name is Kyle McDowell. He's, and he's in the middle of writing a second book and he just got a fantastic story to tell. So he's, and he's actually started to do a lot of coaching and consulting in the title world.

So that's my guy. That's awesome. Any final words for our audience? Oh man, it's, if you go to my LinkedIn profile, it'll say, it's title is boring. Title is boring, but we make it really cool.

I love this nerdy little industry. I mean, it's a, it was something as a young man, I ran away from, and it's very unsexy and half the people out there don't know what we do. I think my kids think I sell cars for a living, but man, if you're passionate about it, you're passionate about this industry, it's get active, get involved. And that's definitely something that has led to a lot of, a lot of our successes is getting out there on the speaking circuits or networking at conventions and conferences and just being active. Because there's so many agents who aren't involved at all.

And they're just head down and heads in the sand. They're not gonna, they're gonna let the world and industry and technology pass them by. So get active. Well, thank you so much, Aaron, for your time and for sharing your wisdom. Oh man, thank you, Mo, appreciate it.

Well, that's a wrap up on today's conversation with Aaron Davis. What a masterclass on growth, leadership and the future of our industry. To get value from this episode, be sure to subscribe and share with your fellow title pros. And as always keep leading, evolving, automating and pioneering. Thank you for listening.

And I'll talk to you soon. See you soon. And that's a wrap on today's journey with Mo Shamil from the Title Agents Podcast. Reminding you that mastering the art of innovation is key and the title industry's fast paced world. If you're finding it tough to keep up with the changes and challenges, remember you're not alone.

Our calendar is open for you. Find the link in the show notes and let's connect. Make sure to hit subscribe to not miss out on strategies that elevate and insights that empower. Together we'll navigate the future of the industry. I look forward to our next meeting in the upcoming episode.