The next focusIR Investor Webinar takes places on 14th May with guest speakers from Blue Whale Growth Fund, Taseko Mines, Kavango Resources and CQS Natural Resources fund. Please register here.
If Oistar is still out there somewhere, I want you to know I'd still be here chatting if the price was going up. I will again gladly send you a nice bottle of Krug if I'm wrong too. Be nice if you'd do the same for me?
Hi Sain,
Lee's got no chance on those options. By the time PB figures out what the answers to disruption success is, it'll be too late for them.
>So just more Assistants? No proper Estate Agents joining up?
That's 100% correct. Former assistants are being rushed through the LPE induction and are becoming agents, but most with no prior Real Estate experience.
Now that the honeymoon is over, proper agents worth their salt, are no longer going to work for PB and giving it a shot.
There are a handful of decent agents still left at PB hoping that the new system of pay will work out, but so far it's not looking like they hoped. However, they're able to justify/blame the slowing market as the problem for now, rather than facing the reality that good agents need to be given support and get paid a lot more to survive the high cost of living in Australia.
Otherwise, good agents end up going to agencies that pay better.
I'm going to miss this chat when it's gone!
Ducky,
Do you remember when I said all the junior Viewing Assistants were told they could only stay on as employees if they become LPE's a little while ago?
So they now have a team of random, and previously out of the industry people turning up to appraisals with their pitch sheet in the left hand and Laptop in the right.
Instruction Stats are like this:
1 in 10 Appraisals is a trip over/given listing that any monkey who rocks up get the instruction
Agents who get 4 instructions out of 10 appraisals and gets them priced right is doing well
Agents who get 6 instructions out of 10 appraisals are usually over-pricing
Agents who over-price if they're good, get the vendors down on price over time, but the complaints and anger is overwhelming, and there's often a lot of refunds.
Most of the current Agents are the calibre of getting 1 instruction per 10 Appraisals.
Wow Sain, you’re right. He’s completely disconnected from normal human emotion. Truth is he knew he was running a business in an insolvent state from the start. At least PB are making a healthy profit to pay for all the marketing, staff and directors saleries, and it's all coming from profitable business operations like any well run company.
Hi Sain,
Dinsdale was said to be on annual leave 2 months ago, and they made out he was coming back.
However, this was never going to be the case.
Larry from the AFR asked 2 months ago, and even he was told Dinsdale was only on leave, but after being probed several more times over the last 2 months, they finally admitted it to him last Friday that Dinsdale had left by mutual agreement, and he published a story about how they had not told him the truth about it, but Dinsdale came out of hiding and sent a fluffy email to try and make it all sound ok.
Most laughable is that the said he's staying on until maybe as late as March.
They may have put him on paid leave for 6 months, but he's not coming in to actually work for PB ever again...
The takeaway here is that for 2 months they didn't tell the exchange about a Material Change to the Organisation's Operations. Sophisticated investors know what that's a sign of, so the way this news came out may have fuelled this week's dip.
Hi Sain,
The early investors have shares worth a lot more than they put in, even at today's price.
There's a lot of signboards around the place, ads on the telly etc... for social proofing to give a sense of security to new investors (mum's and dad's buying shares) and as long as there's a demand for the shares, the original investor's share price has value/hopefully for the goes back up.
However, the company has no assets apart from cash in the bank from investors, of which there's a pretty fast burn rate, and the business does not generate a surplus from operating.
Not sure if it's all that unfair to compare?
Hi Oistar,
In regards to your comment about you not understanding what Ponzi schemes are, check out the video link below so you can get the idea, and maybe figure out how social proofing plays a big part, while large investments are constantly needed to stay afloat and make the people at the top super rich and keep the scheme alive.
https://www.youtube.com/watch?v=q_RVG2qBB_U
Hi Cyberduck,
Thanks for that. It's really interesting for me how a business can be somehow legitimately run without having to actually be self-sustaining for years on end.
Obviously, eMoov's time has run out.
I wonder at what point PB's numbers will need to actually stack up like a normal business?
Hi Cyberduck,
So I'm curious about this statement:
"The majority of the cost of sales is represented by the earnings of self-employed LPEs."
What about the extreme overspend on TV and Google ad's etc.... Are these marketing expenses not "costs of sales?" or are those put into another column? If so, it sounds like creative accounting.
Hi Sain,
Yes for sure, there's been absolute muppets with good postcodes and great agents with average postcodes. However, most of the good ones have realised it's a wash and have left.
In Australia, it worked like this before October:
Instruction = $4999. LPE got $1000, Territory Owner got $150. If TO instructed, he'd get the $1150.
Viewings Package = $770 (Doing the opens and viewings for customers). TO would get $550, but have to pay Sales Associates out of that, there was never enough money generated to cover the Sales Associates/viewing assistant's wage, so PB would "Top Up" the pay to adhere to minimum wage laws.
October on (Likely to change as it's putting too much pressure on LPE's) it Now currently works like this:
Instruction Fee = $4400. LPE gets $1000
Sale Completion Fee = $4400. LPE gets $1250
No extra assistance is given or paid for by PB, the LPE has to do all the opens, negotiations etc unassisted.
Ride the little waves boys! Buying at 175 and selling at 195 seems like easy money to me.
I love how, based on the vaguest mid-term report that literally says nothing, the price still goes up. I really would love to float a company one day too, but actually, have it make money from the outset.
Imagine what PB would be worth if they could honestly show a genuine profit.
Sain,
Bond overpaid and went bankrupt.... If Desmond is the Packer in this scenario, Axel is F'd.
Hi Sain,
I love the amount of research you do!!
Writing's been on the wall for months for sure.
Hi Oistar,
Did you short the stock, or just buy up big mate?
Hi Oistar,
Please buy lots of PB shares. If you're right and make a fortune, I'll send you a bottle of 1988 Krug, and concede.