We Are Selling with Lee Woodward
We Are Selling is a weekly podcast about real estate, business and tackling life's challenges. Hosted by renowned real estate industry coach, Lee Woodward, learn from experts in their field and maximise your life.
We Are Selling with Lee Woodward
Why Treating Property Sales As A Money Process Changes Everything with Lucas McEntee
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We dismantle the broken listed‑to‑settled process and show how banking‑grade rails rebuild it end to end. Lucas McEntee reveals how RiverStone Partners unifies signing, AML, deposits, supplier payments, commission advances, and PEXA settlement into one secure workflow.
• treating property sales as a financial sequence
• the shift from SaleFunder to Riverstone Partners
• why deposits and settlement must come first
• BPAY vs direct debit and chargeback risk
• AML Phase 2 made practical with Equifax
• one screen, seven tabs from sign to settle
• promotion funding and supplier payment controls
• advancing commission at exchange with Agent Funder
• PEXA integration and instant order on the agent
• compliance, SOC 2, ASIC, AFCA, and Law Society oversight
Use this particular link, and you will get your first five settlements free of charge as a special offer
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Hello and welcome to the podcast. We are selling. My name's Lee Woodward, the author of the Complete Salesperson course. In the real estate industry, the listed to settled process or sales sequence has been broken for many years. And the break has been due to the amount of functions required, duplication, and manual labor. And this all started at a manila folder. Then the manila folder went to Manila. And then back into technology will fix it. And then we're going to throw some AI at it. And suddenly it didn't really come together. And the reason being is this is a financial sequence. It's the financials of someone signing an authority to engage an agent. But today in modern real estate, it's changed again with the brand new introduction of AML. And AML is the game changer, as the supply chain right down the line to settlement is going to be affected, as we have to begin with the end in mind. With that in place, although there's a plethora of real estate software in there, the solution I'm presenting and backing myself is from the money management banking style industry, as this is a money process. It's always said that selling your home is the biggest financial transaction of your life. And you're right, it's all money, and a money manager would be the best person to put the sequence together. And over the years, I've spent many of my time not only using, but promoting and bringing to the marketplace sale funder. And sale funder was a massive breakthrough as we had a solution for people to flip their property in the final part of their life tax-free as their principal place of residence. And the results were outstanding. And during that time in our leadership conferences and our sales courses, we've been supported and educated by Lucas McIntyre, and he joins me today. Lucas, welcome aboard. Good to be here again, Lee. You need it. This is a big thing going on, but we have a transition. Your business has expanded. Today we're going to see the full sequence. Sale funder is now who?
SPEAKER_00:Sale funder is now Riverstone Partners. This business has come out of really the private equity money management team. We've been launching a lot of the products to the real estate industry. A lot of it's from feedback and conversations we've had with agents and admin managers over the last four or five years. Sale funder is still very part of our future, but it's now one of many products we'll be taking to the market.
SPEAKER_01:And that brings in our brand new platform, Agent Portal. And Agent Portal has segments to it. We have Agent Sign, Agent AML, Agent Promotion, which is what the sale funder product was doing. But really, our job is to promote real estate, not just price it. We've also got our supplier payments, the deposit process. Agent Funder is a brand new one that I think everyone's going to be very excited about when we explain that you can actually get your commission instantaneously before settlement. And then we've now got a settlement process. To begin with the end in mind, until it settles, nothing is real. The group now is a PEXA partner. Explain that to us.
SPEAKER_00:Yes, thanks, Lee. So yeah, as you can see, there's a big change there from sale funder to all those services. It's been a two-year journey for us. We needed to start actually at the end because a lot of the services we couldn't provide unless we knew we were either in control or managing that deposit. So we've now an incorporated law firm within the group that's a partner of Pexar. And ultimately, when it comes to dealing with that deposit, we're now fully integrated to the major banks, offering pay to and Bpay for buyers to use to pay those deposits. But once those deposits are into our system and into Pexar, it then sort of flows backwards to then help deal with supply payments, with covering the advertising costs, with commissions, and more importantly with AML, which is coming next year as well, which you have to look at your entire workflow for that change to come. And being able to process that payment for the deposit and the advertising, it's was just a natural fit for us to one, look at that entire workflow, but obviously two provide some solutions to the market, which we're excited to bring.
SPEAKER_01:I've just been through the software today in detail. And not only do I think it's stunning, I can see the difference. I've been in software all my life, from writing software, being part of big software companies. I love software. I must bring to our listeners' attention this is different software. It was all written here in Australia. And it was written by people who work in banking code. They're from the money management world. And you can see the completeness and accuracy of that, which has been the biggest challenge with the broken sequence of real estate that we're cutting and pasting and moving around and sending emails that someone's going to hack and this versus the bank would never do that. They couldn't do that. And managing money takes a different grade. What's your observation on that part of it compared to what you've seen in the marketplace, what you arrived to when you just turned up to do sale funding?
SPEAKER_00:There is some lovely solutions out there, no doubt. And they've tackled some big problems in real estate in the past. However, what's tended to happen is that solution will be fixed and solved, and then that business would either be sold to one of the major portals and then it wouldn't be developed further, or they're approaching it from a different perspective, like a CRM business, where they're trying to add services on to build it out. What we've seen is real estate agents have login fatigue, so they have to log into multiple different platforms. The platforms haven't had each other in mind when they've been developed, which is a really big thing when it comes to how they interoperate with each other. You've also two got levels of security that I don't think are always there. So you if you have one weak link in the chain, then the entire system can be compromised. You know, looking at those sort of things, we're like, you know what, we really need to have an end-to-end solution for the sale process. There's still some other services out there that, you know, people will use digital promotion services and digital advertising things that we won't be doing. But in our view, a lot of the bells and whistles in some of these products, they're probably over and above what's needed to sell a property. So we just thought, let's just break it down to be really simple and think through every step of the sale process, where you have initially your appraisal process, then you've got your listing process. That could or couldn't be digitized. We thought that could be. Now you've got to add an AML. And then at that component, you may request some advertising funds to promote the property. Then you've got your supply payments, which are the same supplies over and over again that need to get paid. And we looked at that. I'm just thinking that that alone is a lot of wasted time, energy, and effort. We also, too, coming from that sort of you know, banking, you know, private equity background, we look at things in units. So for us, you know, there's 10 units an hour. That unit has a cost. Not even it's just a cost of out-of-the-pocket, it's opportunity cost. So if you have admin teams running around working on all these different systems and processes because the 10 agents all have different systems and processes, all of that is affecting profitability. And it's also too affecting the agents end commission because the principal can't pay more because he's probably paying more staff to pay all these different systems and solutions. So we just think we could simplify that. And then that flow then moving on to the next stage, which is those advertising promotion packages are very different per agents. Some of them get the money up front, some still carry, some discounts, you know, campaigns change. So how to then deal those funds is very important, and it really meant that we needed to look at handling the deposit.
SPEAKER_01:Now, with that, Lucas, being in software for as long as I have, I do notice with this particular agent portal platform, it's very industrial strength. And what I didn't realize till going through that with you today was you're governed by very different laws to me. If I want to write some software, I can get some code, I can go overseas, I can whack it together. But I may not know the money management laws, yet just take us into what qualifies or what you're identified that you have to do in rolling something like this out.
SPEAKER_00:So SOC two is important. You then also two have to think about uh ISO 2007 requirements for digital signatures. We've then got ASIC with our um ACL or creditor's license. We then also have to be part of AFCA. So we need to demonstrate to AFCA uh every single line that we do is tracked and reported. AFCA is the financial consumer ombudsman, where basically if we provide a loan to somebody that we shouldn't have, or a consumer wants to complain, they can go to Afgha and we have to provide all of the documentation of why we assess that loan, how we assess that individual. And then our entire loan agreement could be rewritten if we didn't do the right thing. So that that means that every step of the process has to be recorded and monitored and tracked and potentially audited. We're then also to our Law Society members, so Law Society of Queensland, Mr. Falls, Victoria, and South Australia. So we're now part of those associations and we have requirements as well, as now an incorporated law firm to deal with those. And that doesn't automatically get you access to Pexar. So we are now a subscriber to Pexar and they're a partner of ours to process the deposit. So there's been a lot of regulation to review, as well as the livestock and real estate acts across every state, because they're all a little different of what and how we can deal with those deposits, and a lot of money spent with lawyers uh to basically understand every single step of the way and then build the tech. So it's been quite a complex two years for us. And then, but understanding every single step is being key, and then how to, you know, make that as a simple five or six-step process for the sale of a house for an agent, it was what we've ended up with uh and we're very proud of.
SPEAKER_01:Well, one thing I'm blown away with is this entire listed to settled sales sequence or process is all in one screen now with just seven tabs. And for all the wonderful administrators I work with around this country, this is heaven versus cut, paste, uh, email. The amount of times these poor people are in the middle of something and a phone call comes in, and I didn't put it back into there and I didn't send it, hence I start with the word broken. But then there's things that have popped up that you've brought to my attention that I didn't know. And quite often you can be working in something, and what you don't know, you don't know. And one of those, and we're going to go through the whole sequence in a moment, but the deposit side was really interesting. As we've got many agents out there using different products where they'll take a direct debit on a an exchange of contracts and they're allowed to use multiple accounts. But behind the scenes of that, there's a whole legal side to take us into that.
SPEAKER_00:The payments industry is being spoken a lot about in the news at the moment about how you know credit cards and merchant fees and all those sort of things are applied. And that's part of um BECs. And there's also to the um MPP, which is the new payment platforms that are being launched. So that's like pay ID and pay two. Payments in Australia, there's been a lot of older systems that you know were legacy, and a lot of them were protected by the banks, not to introduce competition, for example. A lot of these things are disappearing. But something like uh direct debit, people might know of chargebacks with credit cards, where if you buy something on your credit card, you can go back to that merchant and do a chargeback where those funds are automatically then held in a 60-day escrow account for that dispute to be arranged. With direct debit, it's actually seven years. So if you're utilizing a direct debit system, the small print of that direct debit system means that any person that participated in that direct debit process can come back seven years from the time that it took place and uh dispute that transaction. So if you sell a home for three million dollars and you sell it at auction and you use a direct debit system, and let's say the you know husband processes the 300 grand deposit, but five years later, they end up getting a divorce. Either though, you know, the wife slash partner was on title, there could be a dispute, and that dispute very quickly could end up being a chargeback on that trust account for that$300,000. So that$300,000 has to be found and sourced and then disputed by the bank. Now the bank will investigate and check out their processes and systems. But having dealt with AFGA and knowing what they're like, if there's any hint of domestic violence or everything's put on hold until there's a humongous amount of scrutiny on that on that file. BPay doesn't have that though. So BPay Which is why the bank's created BPAY. Correct. Yeah, correct. So with BPay, you actually have to log into the bank, type in the Bipay number, and it actually comes up with the recipient of who's going to be paid those funds to, and it's initiated via the payer. So the payee is the one that pays the funds through to the recipient. They then type in their CRN number, which is specific to that transaction. And there isn't any dispute callback clause. So once that payment's made, it's then clean and done. So for us to handle and deal with a deposit, you know, EFT is one option, which comes with its security questions of people paying the funds to the wrong accounts. You also do have um limits, closed deposits, which is always a headache for, I mean, any agent that's been in an auction that that person doesn't have their limits increased, or, you know, how do they close on this sale? They've got contracts, so they have to pay the deposit by a certain amount of time. All those things are very complex and can have a deal fall over. Pay two is very secure as well, but it also too has limits. So its limits are$25,000 per transaction. And some banks are even$1,000. So pay two, you have to log in, accept the payment contract to make those payments. But B pay, it's up to$10 million. So it's actually$9,999,999, just shy of$10,000. So pretty much every deposit can be paid by that in Australia, you know, unless you're, you know, potentially Alexander Phillips in the Eastern Suburbs. Most deposits will be less than that. And it's safe and secure. And once the payment's made, we have a webhook with the payment providers that can show that it's been made and processing. So once they've paid it, we'll instantly be notified of that payment process. So we can email the agent to confirm that they've actually paid the deposit. And then once the fund's clear two days later, it'll be then down as a process payment. And at that particular point, we'll automatically email the conveyances to let them know that we've received the deposit and how much funds we're holding in trust available for PEXR at settlement. So not only have we thought about the risk in processing those payments, we've removed that risk. We've also too made it more secure with one-time passwords and multi-factor authentication, only using BPAY and Pay2 for payment methods, um, ensuring that all parties are updated quickly and instantly, and everyone involved, every stakeholder involved, is notified automatically just to save the headache of having to copy, paste, repeat the same thing over and over again, which is a lot of admin teams go through on a daily basis.
SPEAKER_01:So Monday mornings in a real estate office of there's three million in the trust account. Does anyone know where it came from? Like this is frightening that this has gone on for so long. And digital tracking at this level, B pay, we've got the tracking of the ID, and the identification process is simple for you, not for me. Why is the platform got such a high level of ID?
SPEAKER_00:With AML, it you need to show that you understand where the source of funds come from. So and that's for all funds, being you know, advertising dollars or deposits. So when you ID the buyer, they might be called John Smith. But if Peter Alexander pays the deposit, it's very clear to show that person is not John Smith. And under AML, you'll need to understand what is the connection, what's the relation. It could be their partner or their uncle or my dad pay the deposit for me, whatever the case may be. But that's part of the AIM or requirements that agents will have to undertake in 2026. And because we can provide that trackability around those payments from um advertising payments and deposits, it just makes the agent's job a lot easier. When they ID the person they're dealing with, we can show that that is the person that made those payments. So it just adds another level of security and safety for the agent when it comes to their umstrack aim or plan. And when they do eventually get audited, which every report and entity has to be audited, they can show that they can see exactly who made certain payments. And, you know, with pay to and b pay, we can track that back to that person. And that's all the technology we've built. So it's not as uh you can't do that with your own bank. That's only because you're a money manager. But it is part of it as well. But we are plugged into the payment gateways. So Cascal and the banks are the main partners and providers of those. They aren't easy to join. So we are partners with Cuscal for our payment processing, and they report back to us with those webhooks and with the pay to contracts who made those payments. And those funds are then paid through to our trust accounts, which are regulated, just like you know, a real estate agent's trust account is, they are regulated under the law societies of every every state. And those funds are dealt with exactly the same way as that state regulatory body requires us to do, and they're made available to PEXR.
SPEAKER_01:So although I may have a trust account, I could park the use of that and just use the main trust account of the platform, which means I'm not at risk, I'm covered, I don't have the administration process within my own office or solo agent, I can choose to use your trust account.
SPEAKER_00:Look, that that is definitely an option for agents. You know, it's it's just important to understand that although we are processing the advertising and the deposits and we are KPMG audited, PEXA partnered, Law Society members, at the end of the day, though, the real estate agent still has their own fiduciary duties to look after and manage and be responsible under their own regulatory requirements. And um there are plenty of agents out there now that don't have trust accounts. But it's important to know that if you deal with one cent of the vendor's money and you hold it in trust, you have to hold a trust account and you have to have it audited and you have to have all the responsibilities that go under that trust account. But if your office migrates and changes to go, you know what, I'm never going to touch funds ever again to hold in trust, then absolutely correct. We are 100% a viable option for the agents to do to do that. And um, like I said before, we're we're Law Society members, our trust accounts are audited by KPMG, plugged into PEXR as a partner. So um it's up to agents to make the decision of what and how they want to run their offices. This is a way forward that is a safe and secure way to deal with payments, as well as have that data plugged into an AML solution, which is very important.
SPEAKER_01:So, Lucas, let's go for a helicopter over our, I'll call it one tab at a time because it's in one place now. It's not seven bits of software, it's just one place. And the first part where everything starts in real estate, although people think it's prospecting, when it comes to a financial sequence, it's not. It's the signature of the authority in the AIDS agreement. What is the platform doing for me there?
SPEAKER_00:So we do plug in all the major CRMs. So AgentBox and Vault and Recs, et cetera. So data can pass across to us to create a record. And then that data is populated into each one of the tabs for all the different functions of the list to settle sale process. So the vendor's name will be populated into the signature component or the sign agreement. So agency portal has its own signing software.
SPEAKER_01:Absolutely. Yes, that's correct. So for some of my seniors who use a phone and they were on paper, they could just fill in the form in the portal signing software. That is correct.
SPEAKER_00:Yeah. So we've still enabled it to be upload handwritten documents, but it's a lot faster for our processing team and the entire process to be done digitally because it's a lot easier to read those documents and track them. But an agency agreement can be uploaded, it can be signed electronically, and the service that we're using is used by um Services New South Wales, PKF, major accounting and law firms across Australia. So it's very well trusted and used it. Correct. Yeah, there's industry strengths, tracking and security. Once the agency agreement's completed, you then move on to the AML component. So the next tab is AML anti-money laundering.
SPEAKER_01:We have all these connections. Take us into it.
SPEAKER_00:Yeah, that's right, Lee. AML is something that every real estate agent's going to have to do uh in 2026. Um, our conversations with real estate agents have given us the position that there's either no idea or fear about AML. Um, it's actually not that hard. Uh, we've been doing AML for six years in our business, uh, ten years within our group, and we're looking to provide a solution that just fits into the real estate agent's existing workflow. There's no need to have any massive changes to the way they go about their business. Um, AML, if you break it down, is really identifying the person you're dealing with and actually making sure you understand where their source of funds or source of wealth comes from. Um, there is going to have to be a little bit more compliance work done from the principal or a responsible officer. But we've been doing this for quite some time, and Austrak themselves are actually recommending that you take their free starter kit as a starting point. You don't need to rush off and sign up to expensive technology stacks or monthly subscriptions. Um, you know, Austrak are going to be providing enough resources um later this year and early next to make sure that every real estate agency in Australia can become compliant very easily.
SPEAKER_01:Well, Lucas, this is an important point. When the AML laws were not confirmed, it was going to be instant, whereas now Austrak realize there's going to be a transition and they're now allowing 15 days of time. So I did some research and everyone was terrified, and all these big companies were coming to the savior that you're going to have to have this. But if you're going along this path with agency settlements, the funding, the deposits, your level of compliance is above, way above me as a principal if I had to go out and do it all myself. That's going to be the difference here.
SPEAKER_00:Yeah, that's right. I mean, because we're, you know, an incorporated law firm and in managing the deposit, um, we've got the same requirements to undertake our own AML as well as a provider and a law firm, as well as AML as a lending business, which we've already done for many years. So we understand the real estate agency workflow. So we've really made sure that the AML solution we're offering is built into that existing workflow just to make it as easy as possible for the agents when they get to market. Now, we're obviously not doing it all ourselves. So we've partnered with Equifax. So for people that don't know who Equifax are, they're an identity credit reporting business. Um, they're a worldwide company and they provide AML solutions to the big four banks. So the big four banks partner has partnered with us to exclusively offer this to the real estate agencies. And, you know, that's a real big voter conference for us in our business. But more importantly, the agents know they're gonna have the best in class technology when it comes to um making sure they're AML compliant.
SPEAKER_01:Yeah, that's a big win. And when we look at this whole sequence, if settlements are gonna become digital, which is a wonderful moment. But question for you, Lucas, if I'm a principal, I'm just engaging you as I would any lawyer to be acting on my behalf of the settlements, but you are a law firm, law service, and I'm just giving you that engagement to say my settlements are gonna be done by agent settlements.
SPEAKER_00:Yes, that's correct. And as part of that process, we'll be providing AML services under agency AML. Um, the agent will still need to, you know, undertake an ID check and those sort of things, but it's all done in less than 60 seconds. So it's a very little tiny disruption to their current workflow and it's built into the system. So it's automatically there to make sure that it's easy for the agents to make sure they are compliant, and we provide all the tracking and reporting and all the things necessary to make sure that you know AML is taken care of for real estate agents.
SPEAKER_01:Lucas, what about the buyer?
SPEAKER_00:The same happens when it comes to the buyer. So when we identify the buyer, we can identify who they are, and then we can also to track the deposit they paid into our trust account, is their funds. So if it isn't, we'll also to let you know that, you know, John Smith signed a sale contract, but Xi Jinping paid the$300,000 from China. So all of a sudden, that would be something that we could flag to say, well, John Smith actually didn't pay these funds, we've got them. You need to ask the question of the contact and relationship between that person and the person that signed the sale contract, and then decide for yourself if you need to report it to Allstrack or not.
SPEAKER_01:So, Lucas, we've signed the agreement, we've done a big chunk of our AML checking due to the call and response of the API calls in milliseconds, which moves us on to our third tab, promotion. And one thing I'd just like to bring to our listeners' attention, this is progressive technology. If signs have been signed, it's filling in all the rest of the stuff. Whereas, Lucas, you were shocked how many times people fill in the same details across multiple platforms.
SPEAKER_00:There's a huge amount of time wasted by double handling, triple handling of data. And, you know, so for us, it was really to minimize all of that to as little as possible, or a minimum of one completion of data, and that's it. And if it's true and accurate, there's nothing else you need to do. So if you've used the agency sign and agency AML or one of those services, that data will pre-populate into the sale funder platform, which will then enable the agent to decide to send the request for payment now or at a later date. And that request then goes through to the vendor via a QR code, an SMS, an email. And then they've got nine different payment methods to make their payments, which could be B pay, direct debit, EFT transfer, Visa, MasterCard, Amex, or they can take a loan, which is originally what SaleFunders started as. And we provide a loan for them to pay their VPA costs, their promotion costs.
SPEAKER_01:And if they value performance advertising and our property and our property improvement plans. And just on that, Lucas, we've had some phenomenal results out there where wealth has been created due to finished product and the marketplace doing so well.
SPEAKER_00:Where two from here? One, thank you again for that. It's been very humbling for us to be part of that process and create so much wealth for vendors out there and help a lot of agents get properties to market. Once that payment has been processed, those funds are approved. And then the agent can get their campaign to market. So whatever they would do, which would be your standard photographer arrangements, signboards, printing, repairs, repairs if you need to, paying rents, paying any disbursements, whatever they may be. Our portal will then list those again, usually multiple suppliers that they use over and over again in our platform. And then the agents, once those works have been completed, can tick a couple of boxes and those funds will then be released to pay that supplier directly. So that brings us to our next tab.
SPEAKER_01:Sign AML promotion. Then we've got supplier payments. Take us into that.
SPEAKER_00:Okay, so the supplier payments space is again quite fraught with a lot of admin costs and overheads. And double payments. And double payments. So some of the things that we've seen is you have a photographer that gets a quote for$500. They go out and do the work, and then the vendor might add one more photograph, which is an extra$30. So what ends up happening is the agent will receive an invoice for an extra$30 from the photographer and they haven't collected the funds. They don't know if they've got approval for it or not. It hasn't been signed off on. All these sort of things happen. Then you've also two got campaigns where the agent may contribute some money towards this campaign to help get it to market, a small one or two thousand dollars to help move the thing forward. You've then also got suppliers that might send invoices for work they haven't done. And it's very hard to track back to the individual property. So our system, one, it will show the exact amount of funds that have been paid. You can upload an invoice which will scan the invoice to preload all the data into the system. So very similar to what would happen with Zero, where it will put in the invoice number, the amount going to the supplier, the supplier name, and the required payment amount and the due date. And then each agent will have a different dollar value of sign off in the system. So you could have a principal that will have a$100,000 limit to sign off paying invoice. Services or someone has$5,000. So that way they don't just automatically make payments or your offshore team, you don't allow them to make payments to at least deal with that part of the business. But ultimately, once the work's been completed, they tick a box and we pay that payment automatically to that supplier. In the event that the campaign is overpaid, we can refund those funds through to the vendor. And in the event that the campaign is short of funds, there's then four alternatives. So the first one is you can ask the vendor for additional funds now to pay those suppliers immediately. Once those funds are received, we pay them straight away through to the supplier. We can decide to collect the remaining funds at settlement. So because we're now dealing with the deposit, we can also add that to the commission at the settlement stage and then have those additional funds go through to pay the suppliers. The agency can choose to pay that on behalf of the vendor out of their commission. So if they have$1,000 shortfall on the VPA invoices, they can decide to take$1,000 out of their commission check and have that go through to pay the suppliers as well. Alternatively, the final two options are the agency can pay out of their general operating accounts, or they can send a link through to the real estate agent to pay on their phone via credit card. And that's where the agent may have covered, you know, some of the upfront costs, or maybe paid for the flowers, or paid for that extra drone shot in their agreement with the vendor. And uh you send a link strictly through to the agent, they pay with their credit card, those funds can be used to clear those invoices out. Or they could have it come out on settlement because the system's tracking it. Correct. Exactly. So it can come out at settlement as well. So all of those solutions are then available to pay all those suppliers, rather than one, having to receipt the promotion funds, two, wait for the invoices to come out of settlement, wait for additional invoices to be sent, tracking who signed off on things, all of that is is recorded. And all of those payments are also to allocated to an agent if the agency so chooses to. So they can then track it payroll for debit credit purposes. So all of that is done as well.
SPEAKER_01:And I think just for our agents listing, you are a supplier. You are someone who's been paid a service. You have a quote and an agreement, which is technically the contract, and suddenly we've been on the marketplace for a period of time. All our promotion has done the incredible job or main sequence of real estate, which is attract, engage, commit. We're now at the commitment stage. Someone's agreed to pay the release price from the owner to own the property, which brings us on to our next tab, deposit.
SPEAKER_00:Yeah, so the deposit process, as I touched on before with regulatory requirements, uh, we only offer B pay and pay two as a payment method. It's safe and secure. It's also too trackable from an AML perspective. So simply the real estate agent would log into the system, type in the buyer's details, the sale price, and the type of deposit, which could be a holding deposit, you know, or 5, 10% or a specific amount. If they're an auction, they can then generate a QR code on their phone for the buyer to scan. And the buyer can then use that QR code on their own device to make payment, or they can be sent an email or SMS to make the payment. Once the buyer receives that link or scans that QR code, they have to enter in a one-time password to their mobile device just to verify again that's who that person is that received the request for payment. They make the payment. And again, BPay has up to just shy of$10 million limits. So no issues around making sure your limits are right to make the payments. It's just done in one amount. The webhook on the BPAY payment allows us to confirm that the payment has been processed to the agent. And once the funds uh hit our trust accounts, we reconcile automatically for the agency. So they don't have to do that ever again. We'll automatically email the vendors' conveyance that we've received the deposit and ask them to start creating the PEXA workspace, getting ready for settlement.
SPEAKER_01:Our next tab could be the most exciting tab for the real estate industry. And that's agent funder.
SPEAKER_00:Yeah, so so agent funder, in essence, is if we have dealt with the process and we are holding those funds in trust, and the circumstances allow being that the agency agreement allows it and the sale contract's unconditional, we can release the deposit um immediately to the agent for a very small fee. Meaning their fee. Correct. So the commission is basically paid to the agency upon request. And we're looking at a 1% per 30-day fee. So on a$25,000 commission check for a fee of$250, uh, we'll advance those funds straight away. That's a game changer. Yeah. Look, we think if we can demonstrate we can save the industry almost$1,000 in admin from the start to finish process of having to manage a property. We know the admin reduction costs mean that everyone's more productive. And the ability then to get that money now. And look, in our view, there's hundreds of millions of dollars of real estate agents' money tied up in trust, waiting to get paid. There's never been an industry I've ever seen in all my years of consulting that has to wait so long to get paid. And that money's just tied up. It's been inaccessible. There are businesses out there that will provide you loans against that service, but their fees are 40 to 60% per annum. They're unbelievable. And that's why very few people use it. So a lot of principals have to turn to the traditional bank overdraft, put their house up, which is a mum and dad decision, at risk to fund the cash flow of their business because real estate is very cyclical. You have your up and down times. So December, January is traditionally poor, June, July is quiet, and that the overdraft is what props that business up. And a lot of real estate agents aren't aware of that, that the principal has to go through that cash flow headache and management of those funds just to stay alive. And then you've got people that start in the industry that don't have the cash to build up their business because they have to wait so long to get paid. So the juniors really struggle for years to get good traction because they just have to wait so long to get their money. So our view is if we can bring forward the entire industry's cash flow by six weeks, not only do they no longer need an overdraft anymore on their house, because our fees are as cheap, if not cheaper, than a bank overdraft. The$250 fee, if we're saving the agency$1,000 for every settlement and admin costs, then they're automatically ahead. So they can use that fee, they can split that fee with the agent, or they can use it as a recruiting tool. They can recruit staff instead of going next door to get paid a settlement, we can pay you in exchange. That's a big thing. And there's so many costs that have been added to the industry the last 20 years that weren't there. But a campaign and market was$150 in promotion costs. Now it's five to$6,000. There's thousands of dollars of admin costs that have been added to business. There's thousands of tech costs. And now you've got AML coming. So, you know, our view is we really need to have a good look of what was going on there. And this money will get paid. You can really hang your hat on the safest houses. Safest houses process, yes. Um, but because we've seen the AML happen, because we've seen the contracts be generated, and because we're holding those funds in trust available to Pexar, and because we are in the PECSA workspace, it makes it a really no-brainer decision for us to go, you know what, this is what we can do for the agency and the industry by sharing that success with them. There's lots of different ways you can build a business, but sharing the success is the quickest way to really grow and provide value and help somebody. And that's exactly what we've where we're where originally this business has started.
SPEAKER_01:Absolutely fantastic. And that brings us to our final destination of settlement.
SPEAKER_00:Yeah. So the settlement process, there's a lot of back and forth and a lot of time wasted. Where one, you've got risk with the agent sending a text message to pay the deposit. That's a problem. Then the deposit's paid, sometimes without a reference number. So the accounts trust manager doesn't know who's paid the deposit. Then you've got the added AML cost next year of who actually paid and am I compliant. Then you have to email the conveyancer to say I'm holding these funds. And sometimes that doesn't happen, which then means the conveyancer is unaware of the funds they're holding. Occasionally the conveyancer will need to contact the agent to provide those funds for settlement because they're short. Then you've got the supply payments have to be paid out of those funds and at least lined up, ready for settlement. Then ultimately, once settlement happens, the conveyancer will send the order on the agent, which can sometimes take hours. And if you're an agent waiting for a buyer, knocking on the door looking for the keys, you can't release those keys unless you had that order on the agent. And then you've got the agency's trust manager has to ring the vendor to verify their bank details, where the horror story is we've heard of deposits being paid to the wrong person, waiting three days for it to bounce back. And we've got the AI voice clone now. Yeah, that's another thing. So anyone that's watched Terminator has uh certainly seen the famous scene of when they're calling to see if if a wolf is okay in the background and his step parents are gone because you know that's now happening in real life. And uh, if you look at any of these voice impersonator AI bots, five minutes on the phone, in essence, they can replicate and generate a recording of your voice and say what they want to say. So all these risks. So we looked at that and thought, you know what, we can we can remove a lot of this and automate it. So our system, once the funds have been paid, we automatically advise the conveyancer that the funds are available. We make the funds available to Pexar. So there's only one settlement. There's no joint settlements anymore, or two settlements from the conveyancer and the agent. Pexar is one of the safest places in Australia to transact this stuff. They do billions of dollars of property a week. So they have their own security measures in place for the vendor to put their own bank details in for payments. You've got the added regulatory oversight by the buyer and seller's conveyances who actually act for their clients under a legal perspective. So they're also too overseeing this process in full. You've then got the removal of the headache of having to chase the vendor for their bank details. And if you can't get them straight away or can't get through to them. And then automating the settlement process. So once settlements happened, the order on the agent happens instantaneously. So the minute it settles on Pexar, the agent will get an email to say you can hand the keys over. Instead of at 6.37 at night for a busy conveyance that's done 10 settlements that day, you'll be told exactly the same time they all happen on PEXAR, which is between usually three and four in the afternoon. So all that time, that can be anywhere from three to eight hours. So if we go back to the per unit cost, if someone's on$135,000 a year, they should be generating$270,000 for the business. You know, that's close to$1,000 of settlement that's been wasted. And that money comes out of the principal's pocket because he's having to pay his staff to run around and chase for this stuff, which ultimately means it's harder to share the commission because there's more overheads. So we just looked at those things and thought, you know what, there's there's more safe and secure ways to do it, which we've we've done. And legally it's been hard. It hasn't been easy to get an understanding of every state's real estate and livestock acts and how they have to perform and deal with things. But we've done it, thank God. And in a fully regulated, transparent way, which has been really exciting for us to come up with.
SPEAKER_01:Well, Lucas, congratulations. I've known you for many years, and Robin and I have used SaleFunder on many occasions, and it's been such a great process. Now to see the other tabs come alive from a money manager and a banking background of other people that work alongside you. This gives us the complete financial listed to settled process. We look forward to the rollout and being part of the teaching and education as people want to know how they can get more efficiency in their business, drop that compliance issue, and to release the trust issues, even right down to the settlement where the poor purchasers sitting with a removalist truck in their driveway and there's no order on the agent. That sounds simple, but that's horrifying for people. And they've got small children, and you can't be out of one house and in another without it. So just to digitize that process is just really exciting. And probably one of the best parts of the real estate sales process that's concerned me for many, many years. You know, I go into companies and say, How do you sell a house? Which is exactly what we've just spoken about. And they'll talk about the DLs going out and so forth. I'm talking about can the purchaser have the keys? Did we sign the authority? Did you check AML, which is the new one now? And this sequence in one screen, this will be how we will be training our future real estate administrators, and they'll have full visibility over the whole journey. Lucas McIntyre, thank you for joining us. And that concludes another edition of We Are Selling. As a bonus to our listener, I've included in the show notes a link to the agents settlements page. Use that particular link, and you will get your first five settlements free of charge as a special offer. I'm Lee Woodward. Thank you for listening, and I will see you next week.