Re/Max Chairman Dave Liniger

Dave Liniger’s adventure-filled, entrepreneurial life story sounds like the tale of a man who has been auditioning for the role of America’s Richard Branson. 

A college dropout, the Re/Max co-founder possessed enough self-confidence at an early age to believe he could help revolutionize a large and well-established industry. And not only did he do just that, but he also found time to start nearly two dozen other businesses in diverse fields—everything from home building and mortgage financing to oil wells, a Nascar race team, and a travel agency. Liniger has also raised over 3,000 Arabian horses, earned a pilot’s license, flown aerobatic airplanes, parachuted out of other planes, competed in Nascar events, hunted big game in Africa, and attempted to circumnavigate the world in a helium balloon.

It hasn’t always been a charmed life. A week before his planned 1983 marriage to Gail Main, his Re/Max co-founder, she survived an airplane crash that killed the pilot and left her critically injured. Liniger himself has endured two airplane accidents and fought his way back from a near-fatal staph infection in 2012 that left him in a coma for three months and kept him hospitalized and mostly paralyzed for a year. 

Born in Marion, Indiana, in 1945, he grew up on a 40-acre farm, attended college briefly, spent time in the Air Force, and began dabbling in real estate. Then, in 1973, he and his future wife started Denver-based Re/Max (short for Real Estate Maximums). 

Though most real estate brokers at the time split commissions with their agents on a 50/50 basis, Liniger’s business model called for charging salespeople a monthly fee but allowing them to keep 100 percent of their commissions while also giving them strong support services. (The model has since been tweaked, but most Re/Max agents still retain 95 percent of their commissions.)

The business took a while to catch on, but it ultimately became a huge success in Colorado, and then, via franchises, throughout the U.S., and finally worldwide. Re/Max now has thousands of offices in more than 100 countries and territories.

On a video call from his home in Colorado, Liniger discussed how he built this now 50-year-old empire, the lessons his life has taught him, and his involvement with business aviation.

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I understand you left Indiana University after a couple of semesters. 

I was very immature. I didn't have my mommy and daddy there to make me study every evening and I did not have any well-defined goals. I went to college because my parents said, “You're going to go to college.” And I wasn't quite ready for that. I ended up going into the Air Force, which was a fabulous blessing. It gave me four or five years to gain some maturity and pick up basic skills.

You started buying and flipping houses while you were stationed in Phoenix with the Air Force?

That's correct. I had read a couple of books on flipping houses. As an enlisted man, I made $99 a month. I also worked three part-time jobs, made about $500 a month, bought a $10,000 property, and fixed it up. Six months later, I sold it for $16,000. So, I made about $6,000 profit, which was more than my Air Force pay and three part-time jobs made me in two years. The die was cast, and once I got out of the military, I continued buying and selling houses, put some investment groups together, and got a real estate license—not to sell real estate but to save commissions on the properties that I was trying to invest in.

You worked at several brokerages before you started Re/Max, one of which gave agents 100 percent of their commissions?

Yes, but it was more of a rent-a-desk concept. When we started Re/Max, we said, “OK, we like the commission concept, but we also like this concept of an outstanding managerial company that can help the agents make more money than they could on their own.” 

How did you team up with Gail? 

I started interviewing for an administrative vice president as my first task. I didn't have a college education or a management background, so I thought, “I can train salespeople, I think I can recruit, but I don't know how to sign office leases, buy office furniture, design an office, or staff it with bookkeepers, receptionists, and secretaries. So, I looked for an administrative vice president. 

I interviewed 27, said no to all 27. The 28th was Gail. She had a management background from Ralston Purina, and I convinced her I was going to create the largest, most successful real estate network in the world. She jumped on board, and it was the best hire I ever made. We've always considered the two of us the co-founders of the company.

Were you just being a salesman when you told Gail you were going to create the world’s biggest real estate company, or did you really believe it?

Let’s just say I was very naïve. I believed my own Kool-Aid.

In its early days, Re/Max got a lot of resistance from the industry. 

Well, we were offering to increase the top producers' income from a 50/50 split. And if the system worked, that meant that everybody was going to have to raise their commission split to the best producers. That was quite controversial at the time. 

It wasn't controversial with the agents. They all said it sounded like a good idea, but nobody wanted to be the first to try it. They would say, “Well, I work with the best company in town. If you make it work, I’ll eventually join you.” And eventually, that's exactly what happened. 

But it was a slow start?

The first three years were miserable. Our investors backed out. We started during the recession caused by the first oil embargo, and we ran into a lot of financial difficulties. A lot of companies tried to put me out of business. 

Fortunately, I was doing a pretty good job, and we had persistence. And by the end of five years, we had 289 agents. We were the number-one company in Colorado—highest earnings per agent, highest number of transactions. And we started franchising. And with the proof-of-concept being Colorado, it was very easy to go throughout the United States, then Canada, and then the rest of the world. 

How did the famous Re/Max balloon come to be?

Early on, our corporate logo was a red, white, and blue sign. The Albuquerque Balloon Fiesta was in its beginning couple of years, and we had two franchisees in Albuquerque. We'd given them permission to have a red, white, and blue balloon. So, then they wanted us to change our company logo to the balloon. And we said no, the balloon had nothing to do with Re/Max, but everybody could have one if they wanted it for a charitable fundraising, a walkathon, or a grand opening. 

A couple of years later, I hired a consultant who said, “You need TV.” But it turned out it would cost about $150,000 to shoot one professional commercial. And I said, “Well, if we do that, we won't have any money left to buy media.” So, the agents said, “Well, we’ve got the balloon and you're a pilot. Just fly around in the balloon and do a voiceover that says, ‘We're above the crowd.’” It was pretty amateurish, but we ran those ads for eight weeks. A report came out that year showing we'd moved to number one in the minds of the people in Colorado, proving the value of advertising.

What do you think made Re/Max so successful?

Number one, the quality of our sales associates; they outproduced the competition three to one. They have to pay us to work for us, so it's very hard for a beginner or part-timer to come to work for us. We've got people who are serious about the business, so they get most of their clients from repeats and referrals.

Also, the more serious you are about your business, the more adaptable you are. And we've had to adapt in the 50-year history of the company. We've lived through nine presidencies and their administrations. Some were good, some were ugly, some were stupid. We've been through eight recessions. Two or three of them were really tough, and in one of them they were trying to break the back of inflation, so the FHA and VA rates went from 7 to 16.5 percent. 

You have to adapt to those circumstances. In 2008, all of a sudden, we had millions of foreclosures. Our top producers were used to selling million-dollar properties. They had to start selling $100,000 to $200,000 repos. The most talented people who are the most adaptable are the most successful.

How do you find those people? And what percent of applicants do you turn down?

A significant number we turn down. Every real estate agent in a local market has a reputation. It's like a small town. Everybody knows who's good and who isn't. So, you're interviewing the very best.

How did you get involved with private aviation?

I had a lot of time in helicopters in Vietnam but was not a pilot. And when I came back to the U.S., we were in two small-plane accidents. I got out of the second accident and said, “I'm never getting back in a plane if I'm not the pilot.” So, I got my private multi-engine commercial and instrument ratings in less than a year. 

I bought a little Piper Saratoga—six passengers, single-engine—and then I bought a Piper Malibu, which was a much hotter plane. And at the time I was flying around the country five days a week selling franchises, setting up offices, and giving seminars, so giving up the crowded, friendly skies of United and the rest of them was easy.

I enjoyed flying the plane but it was stressful to fly for an hour or two, speak all day, and that night, no matter what the weather, fly to the next place. So, we began gradually moving to NetJets shares. We started very inexpensively, like a 16^th or an eighth of a small Hawker.

I still loved to fly for fun, but it was so much easier with our own plane or with NetJets shares to leave the business flying to somebody else. And at the time I was flying between 200 and 250 days a year. So, it was very cost-effective. 

Do you fly internationally with NetJets?

Yes. Right now we've got a couple of shares in a Global 5000. Previously, we were in a Gulfstream 450, 550. I had my own Falcon 2000 for probably about five years and I got type rated in it. But I still had my NetJets shares because we were flying nonstop.

WATCH HIGHLIGHTS FROM BJT’S DAVE LINIGER INTERVIEW

What has business aviation done for Re/Max?

It helped us build our company and multiply our capabilities so much. With private aviation, often we would speak in 10 cities in five days. And that's quite a schedule, to fly out on a Sunday night, set up, speak from eight until noon, fly out at two in the afternoon, get to your next city, speak until seven at night, have a cocktail party, and fly to the next city that night.

You can’t do that on the airlines.

You sure couldn't do it today. There were times 30 years ago when flying the airlines was OK, but private is the only way to go.

Do you ever still sit in the pilot’s seat?

No, I was in a coma for three months in 2012 [due to his staph infection] and a quadriplegic for six months. I eventually learned to walk again, but I can't pass a physical. So, I leave the flying to the professionals now.

Your wife, too, had a life-threatening condition.

Yeah, the week before we were to get married in late 1983, we did a Re/Max convention north of Toronto. One of the franchisees took her and a couple of people on a Lake Buccaneer seaplane and they crashed on takeoff—killed the pilot and left Gail with a traumatic brain injury and paralysis on the left side. She was a full private instrument-rated pilot. Once we got her out of the hospital and the spinal rehab center, she never had a fear of flying again. So, we started flying in our own planes. I set up the Malibu where she could fly it very successfully from the right seat with one hand.

Some people would never get on an airplane again after what she experienced.

No, she's fearless. 

So are you, apparently. You’ve parachuted out of airplanes, flown aerobatic planes, raced in Nascar competitions, done big-game hunting. Do you think this kind of adventurous spirit has contributed to your business success?

We had the advantage of being young. But the biggest thing was I loved adventure. I love to scuba dive, I love to fish, I love to camp, I love to skydive. I think that if I had sold houses for 50 years, I would have been bored out of my gourd and I would have quit after five or 10 years. Because Re/Max grew so successful, every year was new for me. 

You once said you’re the kind of man who rarely asks for help. Has that changed?

It changes when you become a quadriplegic. You can't feed yourself, you can't move your hands, you can't shave, you can't brush your teeth, you can't go to the bathroom by yourself. Some people never survive that. I went through brutal spinal rehab, a year and a half of it. And I got back to the point where I can walk with a cane. I can do 4,000 or 5,000 steps a day. My back hurts, so a lot of times I'll use my electric wheelchair part of the day, but I managed to work my way back. 

Can you tell me about your philanthropic work?

When we started Re/Max, we were totally self-centered about building our company. Then when I was in my mid-40s or early 50s, I took up golf and we started doing charity tournaments for Re/Max. We got involved with Children's Miracle Network [which raises funds for children’s hospitals in the U.S. and Canada]. I ended up building what became Sanctuary Golf Course, one of the top courses in the United States. And in the first year, we had over 100 requests from people who wanted to do a charity tournament.

So, we said, let's do a dozen charity tournaments the first year, and we gave them the course for free. They didn't have to pay the golf-cart fees. They averaged about $100,000 net each. Now, there are 30 charitable tournaments a year, and Sanctuary nets almost $10 million for the charities that we work with.

You’ve said that most of your early senior executives were divorced because there were such long hours. 

I worked hard in the first 10 years—too many 70-hour workweeks. And all the officers I started with, all of us ended up divorcing in five or six years. We were working 18 hours a day with this magical mistress called Re/Max, and we gave up providing the family atmosphere we should have been providing. 

Eventually, most of us found our way. I've stayed married now for 40 some years. Sometimes you work a lot more than you want to, but you're rescheduling your vacations and taking your kids and showing up for their ballgames. And I managed to salvage my relationship with four fabulous young people who are now all in their 50s. They’re very close to their mother but incredibly close to me. 

We've grown up. We acknowledge that being a fanatic about building a business is not the best life balance you can achieve—that there are things more important than chasing the almighty buck or the next trophy. The leaders of the company have gotten past this youthful exuberance and we’re able to speak to younger people and say, “Hey, listen to the voice of experience. I made every mistake there is to make. Don't make the same ones I made.” 

What was your own biggest mistake?

I think the biggest was being proud that in my first 38 years, not one officer of my company quit. I was so proud that they loved the company and me that I didn't say, “You know, there's a half a dozen of those I should have terminated.”

I didn't have the courage because we were friends. We traveled together. We lived together. Our kids were born together, we had vacations. And it was so hard for me to look at somebody and say, “I've asked you over and over again. You need to grow with the company—you're not growing.”

But finally, you reach a level of maturity where you realize that by not terminating somebody when you need to, you're really hurting three groups of people. You're hurting the people you don’t terminate because you're never going to promote them again. You're hurting the people that work for them because they're saying, “I wonder what the hell they've got on the boss that he didn't fire them. We know they're not worth a darn.” And finally, you're hurting yourself and your own progress. 

If you're truly a leader, you grow the courage to lead. And that means you make the difficult decisions. You can do it humanely and diplomatically, but you do make those decisions.

One criticism that's sometimes leveled at your industry is that the agents work for the seller, and the buyer frequently doesn't realize that. If the buyer tells the agent he could offer a little more money, the agent is obligated to pass that information to the seller. How has Re/Max dealt with that issue, and how do you feel about buyer brokers?

Yeah, we saw buyer brokers coming into the industry well over 30 years ago, and I quickly adapted to buyer brokerage. It's like if you're getting a divorce, no attorney that’s sane will represent both the husband and the wife. It's impossible. So, buyer brokerage made a lot of sense to me. I was one of the brokers that got behind it. I think that dual agency works with full disclosure, but I think you're much better with both parties being represented separately. About half our brokers now are buyer agents. 

Do you have any thoughts about the fact that home ownership has become increasingly out of reach for young people?

The pendulum swings left and right. We’re in an era now of increasing interest rates and increasing home prices. The millennial generation wants home ownership. They will find a way to get it. Builders will become more efficient. Interest rates will go lower again, and people will get their foot in the door. [Because more people are working from home now], a lot of people have decided they can leave an area where housing is way too expensive. They can go to the Midwest where they can afford a home. 

There was criticism in 2014 about Re/Max’s Israeli franchise, which dealt in real estate in occupied territories. At the time, Re/Max said it had sold the brand rights and wasn't responsible for the franchisee’s actions. But didn’t you control the brand name and have the right to end the franchise?

Unfortunately, when we sold Europe, including Israel, it was sold as a master franchise to some very successful Canadian brokers of ours. Nobody anticipated the Palestinian territories at the time, and the documents were not drawn in such a way that we could prohibit them from moving into the territories that they did. We explained that consistently. We showed the documents to the U.N. group that was pro-Palestinian.

We really are not much different from Caterpillar or Coca-Cola or anybody else that got stuck with contracts 30 years ago that we can't change for another 10 years. So, we understand the plight. We try to help people where we can. We just can't violate the contracts.

You stepped down as CEO in 2018. Are you still spending a lot of time on the business?

I spend 60 to 70 days a year on Re/Max. I do investor relations, travel internationally, and do the major conventions to continue to be a cheerleader for the company, as does my wife. But we're closing in on 80 and I recognized 10 years ago that no matter how intelligent I am and how much experience I have, younger, faster, smarter people will always be nipping at my heels.

I'm in love with the company I started. I want to leave it in great hands. I don’t want to stay so long that I tear down what I built. 
 

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This interview has been edited and condensed.

Jeff Burger, the editor of Business Jet Traveler, once served as editor-in-chief and associate publisher of a magazine called Real Estate SalesPeople.